After securing the signing of Kylian Mbappé, Real Madrid's next target is to try to sign Bayern Munich full-back Alphonso Davies, sources have told ESPN.

The Canada international's contract expires in 2025, and ESPN reported in January that Madrid would move to sign him if the player decided not to renew, and Bayern preferred a deal this summer rather than losing him for free next year.

Sources close to the deal have told ESPN that the relationship between Madrid and Davies is "excellent" and the club are waiting for the player, and Bayern, to decide on their next steps before moving to sign him.

Davies is assessing Bayern's latest contract renewal offer, sources told ESPN, but the terms are a long way from what the player would consider accepting to continue with the Bundesliga giants.

Davies had a difficult season with Bayern, who have appointed Vincent Kompany after a lengthy search for a new manager.

Bayern ended the campaign trophyless, and were eliminated by Madrid in the Champions League semifinals, with Davies coming off the bench to score in the second leg at the Santiago Bernabéu.

Madrid will not overpay on a transfer fee for a player who would be available on a free transfer in 12 months' time. In January, ESPN reported that Madrid would not be willing to go beyond 35-40 million, and that remains the case.

However the LaLiga and European champions are also keen to avoid damaging their relationship with Bayern, a source said.

Madrid are optimistic about their chances of signing Davies, but will only do so if Bayern accept negotiating around a price point which fits in with their budget this summer.

Davies, 23, would be seen as an important addition to the squad. Madrid coach Carlo Ancelotti was reluctant to pick academy product Fran García at left-back this season and the future of first choice Ferland Mendy is uncertain, with his contract up in 2025.

Madrid were willing to let Mendy move on last summer, with the player suffering persistent injury problems since his signing in 2019.

At that time, no suitable offers arrived, but this summer the situation could be different, given his notable improvement in performance in 2023-24.

Sources would not confirm if Mendy's future, and the signing of Davies, are directly related.

Madrid's road map for signing Davies has been to follow the formula they used to bring in Toni Kroos from Bayern in 2014, when they were able to negotiate an affordable price for a player who was also due to be out of contract a year later.