Manchester United have reportedly pulled themselves out of the running to sign Tottenham Hotspur playmaker Luka Modric.

The Croatia international has been linked with a switch to Old Trafford in recent months, with Chelsea and Real Madrid also thought to be options for the midfielder.

While many have suggested that the former Premier League champions are in need of an additional player in the middle of the park, it is understood that Sir Alex Ferguson is unwilling to meet Tottenham's £40m asking price, according to Goal.com.

Reports have claimed that the Red Devils' Scottish boss is not too concerned with entering the transfer market for a playmaker following the acquisition of Borussia Dortmund's Shinji Kagawa.

Meanwhile, Real Madrid have emerged as the favourites to lure Modric away from White Hart Lane.