United were reluctant to meet Borussia Dortmund's €120million asking price for the England winger and sounded out other options on loan to fill the right-wing position, which had been identified as a priority for the summer.
They wanted to negotiate a cheaper price for Sancho amid concerns over paying such an inflated fee in the current financial climate.
But Dortmund stood firm, insisting that Sancho would stay and stayed true to their word — although United are expected to launch another attempt to sign the player next summer.
Ole Gunnar Solskjaer is a major admirer of Sancho, with the 20-year-old a perfect fit for the club's policy of signing young, talented players hungry for success.
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