Manchester City manager Roberto Mancini said on Monday that the English Premier League club had agreed a deal to sell their Argentinian star Carlos Tevez to Brazilian side Corinthians.
"At the moment we have an agreement with Corinthians, but Carlos now is still a City player," Mancini told Sky TV.
Reports claimed that the deal would be closed when personal terms between the 27-year-old Tevez and his new club are agreed.
However, Corinthians later released a statement denying any such agreement had been reached.
"The truth is that Manchester City sent Corinthians a counter-proposal this morning," the statement read.
"In that proposal, the English club have asked for changes in the form of payment and the total value of the transaction.
"Furthermore, Manchester City insisted that Tevez renounce a sum outstanding with the English club.
"Finally, Corinthians president Andres Sanchez informs that for the moment nothing concrete has been agreed regarding Tevez and that the counter-proposal will be analysed by him and his board."
The Brazilian side's initial offer for the striker was reportedly worth 40 million euros ($63.57m).
The striker wants to leave Manchester to be closer to his daughters, who live in Buenos Aires with their mother, his estranged partner.
The Argentina forward, formerly with West Ham United and Manchester United, led City to FA Cup glory and Champions League qualification last season.
Tevez, who missed the crucial penalty kick as Argentina went out of the Copa America quarter-final 5-4 on penalties against Uruguay on Saturday, arrived in English football at West Ham from Corinthians in August 2006.
Selling Tevez to Corinthians would enable City to offload him to a club with whom they are not in direct competition, either domestically or in Europe, while also improving the player's family arrangements.
Tevez said on Monday that he "would have no problem to go back to Corinthians", where he won the 2005 league title and became a great crowd favourite.
City defender Joleon Lescott admitted he would be disappointed to see his team-mate depart but understood his wishes.
The England international told Sky Sports News: "We'll be disappointed if Carlos leaves but it was down to the club and Carlos what was best for each other and they have come to an agreement so I wish both parties all the best.
"Carlos is his own man. Last season he played to 110 percent every game so none of us will be holding any grudges towards him and we'll wish him all the best if he does leave."
If Tevez does leave City they are expected to bid for compatriot Sergio Aguero of Atletico Madrid, who is currently keeping him on the Argentine bench.
Aguero, Diego Maradona's son-in-law, has a release clause of 50 million euros at Atletico.
Aguero's agent Hernan Reguera admitted that the striker's future will soon be resolved now that Argentina are no longer in the Copa America.
"He wanted the Copa America to end to sit down and talk. During this week everything will be settled," Reguera told Ole.
Reguera insisted that Aguero's decision to leave Atletico had nothing to do with money and that he wants a new challenge.
"In seven days the subject will be closed, but this has nothing to do with money. He wants his career to grow."