Real Madrid president Florentino Perez has ruled the club out of the running for Brazilian Ronaldinho for the time being.
Ronaldinho is United's top summer target
The Spanish giants looked to be in a two-way battle with Manchester United for the 23-year-old Paris St Germain star.
However, United's hopes of landing Ronaldinho could be scuppered if reports are true that Barcelona have made a late bid to sign the player.
Ronaldinho's brother and agent Roberto Assis could not confirm rumours that Barca president Joan Laporta had
submitted a new bid to sign the forward.
"I have heard PSG have received an offer from Barcelona but I can
not confirm it," Assis said.
But Ronaldinho will not go to Real after they said they are not looking to strengthen their squad following the signings of England captain David Beckham and Argentine international defender Gabriel Milito.
"The business of buying new players has now been closed and that's for sure," Perez said.
"Milito's signing means that Ronaldinho will not be coming to Real Madrid this year."
Ronaldinho is said to favour a move to the Spanish champions, but that would mean staying in Paris for a further season - an option that does not appeal to the Brazilian.
According to reports United offered an initial £14.5m for Ronaldinho, but upped it to £17m to match Real Madrid's bid.
Ronaldinho's brother Roberto Assis, who acts as his agent, says the long-running saga over the Brazilian's transfer will reach its conclusion on Thursday.
Milito is expected to join Real for a fee of just over £2m from Argentine side Independiente, filling the gap left by discarded captain Fernando Hierro.
Real said that the 22-year-old Argentine would travel to Madrid at the end of next week where he will undergo a medical and then be presented to the media.
The club earlier splashed out £25m for England skipper Beckham from Man Utd.