Chelsea in Rafael Leao transfer blow as AC Milan draw up new contract in bid to fight off interest in January

CHELSEA have been dealt a huge blow in their pursuit of AC Milan star Rafael Leao.

The Italians giants are drawing up a new contract to block the Blues from making a January bid.

Milan boss Stefano Piolo admits he’s hopeful Leao commits to a new long-term deal at the San Siro.

The versatile striker, 23, emerged as a deadline day transfer target for Thomas Tuchel last week.

Chelsea wrapped up a deal for Barcelona striker Pierre-Emerick Aubameyang.

And they also moved to sign Juventus midfielder Denis Zakaria on loan.

However, Chelsea looked at a late swoop for Leao too.

But they backed off when Milan demanded they meet his mega £127million release clause.

Chelsea are now already plotting several moves for January, with Ajax anchorman Edson Alvarez top of their list.

Dynamo Moscow playmaker Arsen Zakharyan is also in Todd Boehly’s sights.

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And it’s reckoned Leao remains on Chelsea’s radar too.

The Portugal international has already enjoyed a flying start to the new season with three goals in five games.

Two of those came in Saturday’s 3-2 derby win over rivals Inter Milan.

And AC boss Piolo admits the champions are pulling out all the stops to secure Leao’s signature on a new lucrative deal.

He said: “The club wants to offer Leao a new deal soon.

“They will take care of it, he’s working at the best level.

“He’s not creating any problem, he’s just working hard as a top professional.”