The Rossoneri have been heavily linked with the Italy international, whose topsy-turvy temperament and below-par performances have seen him fall out of favour at the Etihad this season.
And the San Siro chief explained that he has faith in the promising talent at his club, and hopes that the team will become a world-class side once more with the next few years.
"We sold [Zlatan] Ibrahimovic and Thiago Silva [in the summer] for monetary needs, but the others left for age reasons," Berlusconi told Radio Mars.
"Our goal is to return as a big team in three years' time, to start a new cycle with [Stephan] El Shaarawy - who is an extraordinary player - and Mattia De Sciglio, who will become a champion. Niang is better than Balotelli."
After making the same claim earlier in December, the Milan president also proclaimed himself as the greatest president in the history of the sport once again, and insisted that the club should still be considered one of the best in the world.
"We're the team who won most international trophies, we are the most successful team in the world," Berlusconi added.
"I'm the most successful president in the football history, and in second place there is [former Real Madrid president Santiago] Bernabeu, who has a stadium dedicated to him."