According to latest reports, Manchester City and Chelsea are monitoring the situation of Real Madrid defender Pepe after his new contract talks has been put on hold by new manager Rafael Benetiz. 

Benetiz is keen to make Varane central to his defense next season and will leave Pepe to prove his worth under him suggests the reports. The 32-year old has been rotated with Varane last season and could lose his position to Varane under the new boss.

Pepe currently has contract with Real Madrid till 2016 and a new two year extension was being negotiated under former boss Ancelotti but the new boss wants to keep hold of his contract. The Portugese international would be a free agent next summer if he cannot make impact under Benetiz.

The 32-year old will leave for summer with his future at Bernabeu unsorted. Premier League clubs Manchester City and Chelsea are monitoring his situation as they want to make a transfer move for the Portugese defender.

Both the clubs are keen to make a move this summer and Real Madrid would ask for around £10.5 million. Pepe has joined Real Madrid back in 2007 and made 195 appearences for the club in his eight year spell at Bernabeu.

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