The 21-year-old has been heavily linked with a move to the Etihad Stadium in recent weeks before Pellegrini was confirmed as the club’s new manager on Friday.
Isco has played a key role in helping Spain reach the European Under-21 championship final in Israel, and the playmaker is yet to make a decision on his future.
“Well, I have two offers on the table,” Isco told AS English.
He added: “I hope to make my decision soon although right now, I am still under contract with Málaga.
“I know that both Manchester City and Real Madrid are two great clubs. I just want the best outcome for me and for Málaga.”
Isco quashed reports that the midfielder has spoken with his former manager about a move to the Citizens but backed Pellegrini to be a success at City.
“No I haven’t spoken to him,” Isco said.
“I found out that he would be joining City on the internet at the time but he hasn’t phoned me.
“He is a great coach and I hope that it all works out for him in England. He is a fabulous coach – one who did a fantastic job at Málaga – just like he did for his previous clubs so I am sure he will do an equally good job over there.”
However, Isco admitted that the chance to work under Pellegrini was a factor to take into consideration as the Málaga star makes his decision.
“Of course, Pellegrini is someone who I already know, I know how he works and he has played a fundamental role in my career during the two seasons he was at Málaga,” he added.
“It’s a factor in favour that we have been at the same club and that I know his working methods but I would say that it would be a decisive factor.”
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