Smalling is currently on loan at Roma and his impressive form has attracted interest from within Italy's top-flight.
Last summer, Smalling was told he would have limited game-time at Manchester United this season and so moved to the Italian capital on a season-long loan.
United's acquisition of Harry Maguire from Leicester City for £80m hasn't greatly aided their defensive struggles so far this season.
Ole Gunnar Solskjaer is thought to be keeping a keen eye on Smalling's progress, with a view to an Old Trafford return for the defender.
Both Milan clubs are keen to strengthen their defences and are extremely keen on the 29-year-old.
It's understood, however, that despite welcoming interest Smalling would prefer to make his loan move permanent and stay in Rome.
United are believed to want £17m for the English centre-back and have informed Roma as such.
It was reported by the Daily Star a couple of days ago that United had rejected an offer worth £13m from Roma.
Crucially, Roma do not have a first-option for Smalling's purchase, so the player is open to bidding upon for Inter and AC Milan.
Smalling scored his first goal for the club against Udinese recently and has performed admirably in his first seven appearances.
Smalling spent nine years at United, making 200 appearances and helping them to lift five major trophies.
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