By North-west correspondent Alex Stevens

Liverpool are ready to battle with Manchester City for the signing of Ilkay Gundogan, Football Insider sources understand.

The Borussia Dortmund midfielder has told the Bundesliga side he will not be extending his contract, which expires in the summer of 2017.

Liverpool boss Jurgen Klopp, who was Gundogan’s former manager at Dortmund, is a firm admirer of the player and has asked to be kept informed about his situation.

Liverpool are in the market for a central midfielder this summer amid growing speculation that Jordan Henderson could leave Anfield.

As revealed by Football Insider, the Merseysiders are closely monitoring Polish sensation Piotr Zielinski, while they also have an interest in Swiss star Granit Xhaka.

Zielinski, 21, has been one of the stand-out central midfielders in Serie A this season after establishing himself in the Empoli side while on loan from Udinese.

Borussia Monchengladbach’s Xhaka, 23, is highly rated and he is being closely watched by the Merseysiders.

Liverpool are also interested in signing Gundogan, who is set to leave Dortmund at the end of the season in a £20million-plus deal.

Liverpool are keeping close tabs on Polish star Piotr Zielinski

Blue-eyed boy: Liverpool are monitoring Empoli star Zielinski

The Germany international came close last year to joining City’s rivals Manchester United, but the 25-year-old is now a serious target for incoming manager Pep Guardiola.

Reports in Spain have claimed Gundogan has committed himself to City but a Liverpool source has told Football Insider that the Merseysiders have not given up hope of landing the 16-time capped midfielder.

Gundogan joined Dortmund from Nuremberg for £4million in 2011 and has established himself as one of Europe’s most sought-after midfielders.

He signed a contract extension last summer but it is due to expire in 16 months and the German club are ready to cash in at the end of the season.