AC Milan, Inter circle for Real Madrid defender Pepe

Italian clubs are interested in Real Madrid defender Pepe.

Corriere dello Sport says AC Milan and Inter are interested in the Portugal defender.

He is in negotiations with Real to extend the contract that expires in June 2012 and requested a salary that matches teammates Mezut Ozil and Karim Benzema.

Instead, the Spanish club have offered €3.5m per season and it’s reported the 28-year-old rejected this proposal.

Pepe would be available for around €15m plus a salary of €4.5m per season.