Chelsea and City at odds over Sturridge

Chelsea will almost certainly take their pursuit of Manchester City's young striker Daniel Sturridge to a tribunal, with the clubs as much as £7m apart in their valuations of him.

City officially released the 19-year-old on Tuesday with his wage demands rendering further contractual talks futile, but they still want a payment of £10m for him, payable as a development fee because he is under 23. Chelsea and City are millions of pounds apart in their valuation – both on the down payment and on the add-ons that will be built into the fee.

City's position is that they have nurtured a young footballing talent who they rank in the Theo Walcott bracket for potential. Chelsea argue that the teenager, brought to City from Coventry six years ago, has not played enough games to warrant the selling club's valuation.

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There are grounds for negotiation, with Chelsea potentially offering £5m up front, with less conditional on the player's performances, but the clubs are too far apart for a likely resolution outside of a valuation tribunal. City do not believe the dispute will hold up Sturridge signing for Chelsea.

Mark Hughes has suggested his job of rebuilding City will not be complete this summer. "We might not be able to get all the players we need this window. There might be other windows we need," he said. "Last year we couldn't fulfil expectations. This year we will."