Antonio Conte identified Sassuolo standout Domenico Berardi early on in the summer as a Chelsea target but the Blues were unable to get a deal done for the versatile attacker.
Berardi scored four goals and provided nine assists for his teammates in Serie A last season and has become a regular call-up for the Italy national team over the last 18 months.
The 22-year-old can play on either wing or through the middle, offering a versatility that is coveted in the modern game.
Chelsea do like to play with a fluid front three and Berardi could in theory slot in alongside Alvaro Morata and Eden Hazard and fit in seamlessly.
The Blues could still make a move for Berardi in the future given their long-term interest but Don Balon claim that Real Madrid have singled out the attacker as a potential signing in the near future.
Cristiano Ronaldo and Gareth Bale both continue to be linked with moves to Real Madrid and Berardi could step in to replace them at the Bernabeu but Chelsea could revive their interest down the line.
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