The Serie A outfit have been linked with a move for the 22-year-old throughout the January transfer window and are set to snap up the Italy international for £20 million
Manchester City have agreed the sale of Mario Balotelli to AC Milan, Goal.com understands.
The two clubs reached an agreement over a €23.4 million (£20m) deal that will be spread over five years to see the Italy international move to San Siro.
Balotelli is expected to earn €4m (£3.4m) a year, a paycut from his current £110,000 per week deal at the Premier League champions, and sign a four-and-a-half year contract with Massimiliano Allegri's side.
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Milan revealed via their Twitter account that "Balotelli's medicals will take place [on Wednesday] at Busto Arsizio and Milanello", while his first training session with the team will take place on Thrusday.
As Goal.com exclusively revealed on Monday afternoon, negotiations between the two clubs had accelerated, leaving Balotelli poised to undergo a medical in Milan ahead of the proposed transfer.
City were understood to be holding out for £22 million from Milan, while also insisting that a 15 per cent sell-on clause is added to any deal, but it is believed the club have since eased their stance.
The 22-year-old said goodbye to team-mates and club staff after Monday morning's training session at Carrington, as he prepared to leave for Italy after a tumultuous time in England.
Balotelli's stock fell after a training ground bust-up with manager Roberto Mancini, and although he was subsequently dropped from the first-team but given a reprieve by the 48-year-old, he was made available for transfer.
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On Saturday, Milan vice-President Adriano Galliani said he was "99.9%" certain that the Rossoneri would not be able to sign Balotelli, but in a press conference on Sunday he suggested further progress had been made.
"Yesterday was 99.9% no, today is 99.5% no," he told reporters. "It is a situation different from that of yesterday, but the bag is closed until tomorrow morning."
The former Inter Milan forward has netted just one league goal for City this season and featured in just five games since November.