Man City to battle Barcelona for free agent Gündogan - Guardiola

Does Kovacic to Man City signal the end for Gundogan? (1:55)

Rob Dawson discusses what impact the arrival of Mateo Kovacic will have on Manchester City's squad. (1:55)

Pep Guardiola said Manchester City are fighting with Barcelona over the signature of Ilkay Gündogan, with sources telling ESPN the midfielder will make a decision on his future this week.

Gündogan, 32, is out of contract with City at the end of June, but the Champions League winners have offered him the chance to extend his seven-year stay at the club.

Barca are also keen to sign the Germany international, and Guardiola said he knows the Catalan club's coach, Xavi Hernández, has been in touch with the player.

"We are interested in renewing his contract and [Barcelona] are also interested," Guardiola told reporters at the Puma Legends golf tournament on Monday.

"I hope he stays with us. We are still fighting for him to stay with us. He is a player we want to stay -- and we will do all we can -- but we know Barca want him.

"If Barca sign him, they will have a spectacular footballer on their hands. I am aware Xavi has called him a lot. If, in the end, he picks Barca, I will tell him he will enjoy himself."

Sources told ESPN in March that Barca had sounded out a move for Gündogan, with sources last week explaining they were still waiting on the former Borussia Dortmund player's final decision.

Xavi has made it clear he wants to add more goals and creativity to midfield this summer, saying a "Santi Cazorla-type player" would be the ideal signing to help build on a first LaLiga title since 2019.

Another City player who has been linked with Barca is right-back João Cancelo, who spent the second half of the season on loan at Bayern Munich in the Bundesliga after falling out with Guardiola.

Xavi has said Barca were also keen on signing Cancelo in January, but that City would not sanction the Portugal international's move to Spotify Camp Nou.

"I read that, but Xavi has been misinformed," Guardiola said in response to those comments. "The reality is that João had to leave and we didn't mind where he went -- no offer arrived from Barca."

Guardiola also ruled City out of the race for Paris Saint-Germain striker Kylian Mbappé, who has said he will not extend his deal with the French side beyond its expiry in 2024.

Mbappé said he still wants to remain at PSG next season, but sources have told ESPN that to avoid losing him for free, the French club will look to move him on this summer.

Real Madrid previously came close to signing him and Guardiola hinted that will be the France forward's next club despite links to several Premier League sides.

"We won't make a move for Mbappé," the City coach confirmed. "You already know where he wants to go."