Diarra joined Liverpool from Bayern Munich in 2002, but left Anfield after two years after failing to make an impact at the club.
The 29-year-old has become a key player for Bordeaux, but Le Parisien reports that City are ready to bring the midfielder back to England with a £7million bid.
Diarra’s contract with the Ligue 1 side is set to expire in the summer of 2013.