Town have rejected Hull City's initial bid for striker Alan Lee. However, the Tigers are expected to make a new offer for last season's 17-goal top scorer before the weekend.
City's first offer is understood to have been well below the £500,000 price tag Town are believed to have put on the Republic of Ireland international.
Chairman David Sheepshanks says the Blues were not interested in the bid: "Hull City made an offer for Alan and we told them we are not prepared to sell him.
"We want to keep Alan and that is the end of it as we see him as a valuable member of the team."
Despite Town repeatedly stating that the 28-year-old isn't for sale, speculation regarding Lee's future has persisted since the unauthorised Amsterdam trip at Christmas. The former Cardiff and Rotherham man has only a year left of his Blues contract and if an offer in the region of £500,000 were to come in, Town would almost certainly sell.
Sources in Hull report that Phil Brown's club will make an increased bid over the weekend, while we understand that Lee, previously without representation, has recently been in talks with an agent.
Coventry City are also very interested in the Galway-born striker, who joined the Blues from Cardiff for £100,000 in January 2006, but may have to wait on the completion of their takeover before they can afford Town's asking price.
Lee himself is understood to be happy at Portman Road and settled in the area, but with no new deal on the table is likely to accept a move for an improved contract elsewhere.
Meanwhile, boss Jim Magilton has confirmed that he made a loan enquiry to Newcastle regarding 18-year-old striker Andy Carroll: "He burst on the scene and played Premiership football at a young age and as Sam Allardyce has a number of strikers we asked about him and we were politely rebuffed.”
Reports of Town interest in Carroll broke a fortnight ago with Magpies boss Allardyce appearing to misunderstand Football League loan rules, but a newspaper in the North-East says the Blues have made a bid since the Franny Jeffers deal broke down earlier in the week, so there may yet be chance of the Gateshead-born striker spending the year at Portman Road.
The Blues could see the 6ft 3in tall frontman as back-up for Jon Walters if and when Alan Lee leaves the club.
Elsewhere, Blackburn boss Mark Hughes says he expected Town target Franny Jeffers to have left his club by now and has hinted that the move to Portman Road might not yet be completely dead: "It's difficult for Franny and for myself.
"We have to prepare for the season and, obviously, over the last few weeks I've had it in my own mind that Franny wouldn't be with us, because it looked like it was almost certain he was going to leave us.
"But that situation has changed in the last few days, so maybe my thinking has to change.
"I thought it was a decent move for Franny. There's a lot of competition for places here at the moment, and I thought for all parties it would have been a decent move. But it seems to have broken down at the moment."
In addition to a striker, Town are keen on adding to their midfield numbers with Magilton hoping to bring in his target over the weekend.
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