Chelsea are said to have made clear they would only discuss a sale involving Gusto if it came as part of a player-plus-cash package including Nico O'Reilly, the versatile young City academy graduate who has previously attracted interest from Stamford Bridge.
Manchester City are understood to view Gusto as an ideal option at right-back but had no intention of meeting Chelsea's reported £80m valuation of the France international, leaving the proposed structure as a non-starter from City's side.
Chelsea have since denied that Gusto was ever made available for transfer and rejected the suggestion that O'Reilly formed any part of a proposed deal, though the report highlights the extent of Chelsea's long-standing admiration for the 20-year-old midfielder.
City have previously knocked back approaches from Chelsea for O'Reilly, including a formal enquiry during the January transfer window that was swiftly turned down, with Pep Guardiola said to view the academy product as a player with a big future at the Etihad.
Gusto joined Chelsea from Lyon in a permanent deal completed in January 2023, initially returning to France on loan before linking up with the Blues for the following campaign. He has made over 100 appearances for the club since establishing himself as first-choice right-back, and would represent a significant departure from Stamford Bridge given his contract, which runs until 2030.
O'Reilly, for his part, signed a new long-term contract at City this year, tying him to the club until 2030 and underlining how highly he is regarded by Guardiola's coaching staff. Any deal involving City actively offering up one of their prized academy graduates as makeweight in a deal for a Chelsea player would represent a notable departure from the club's usual transfer strategy.
O'Reilly broke into City's first team last season, making 27 appearances in all competitions and scoring five goals, having come through the club's academy since the age of eight. His versatility, capable of playing at left-back as well as in midfield, has made him a valuable option for Guardiola's successor at the club, and the fact Chelsea remain keen on a player already tied down to a long-term deal reflects the esteem in which he is held elsewhere in the Premier League.