Allan Rodrigues will rejoin Liverpool after Hertha Berlin rejected a second loan spell.
The Brazilian made 16 appearances for the Bundesliga side as he spent the previous campaign with them to gain first-team experience away Anfield.
But Allan, a 2015 arrival from Internacional, is now returning to the Reds as Hertha were unable to agree on an extension to his time in the German capital.
Hertha’s general manager Michael Preetz hinted in April that his side were considering the offer of a renewed spell to Allan for next season.
According to Bild however the Berlin club are unwilling to match Liverpool’s financial requests to allow the 20-year-old to spend another 12 month on loan.
Allan is unable to play competitively for his parent club as the midfielder is yet to obtain a UK work permit following the move from his homeland two years ago.
Liverpool are due to take on Hertha in a pre-season friendly next month as both clubs prepare to celebrate their respective 125th anniversaries.