Werder Bremen have turned down an offer from Real Madrid for playmaker Mesut Ozil.
The future of the Germany international has been the subject of intense speculation ever since he refused to sign a contract extension with his current club.
Bremen revealed this week that no offers had been made for the 21-year-old, one of the stars of this summer's World Cup, but that situation changed when Madrid announced they had made an official approach.
The German club's director of sport, Klaus Allofs, turned down the offer out of hand.
"We have received an unacceptable offer that does not even provide any basis for negotiations," he said.
Madrid boss Jose Mourinho will now ask his sporting director Jorge Valdano to return to Bremen with an increased bid.
"He is a very good player and I would be delighted were he to come to us," said the Portuguese coach after his side's penalty shoot-out win over Bayern Munich in a pre-season friendly.
"Bremen have said no so we will have to see how things develop.
"If he comes, it would certainly be excellent. Ozil would definitely help us."