Former midfielder Paul Merson has warned Villa to forget the Champions League if they cash in on £30million-rated James Milner.

Milner was part of a dejected England squad which arrived home from the World Cup in the early hours of this morning and resolving his future will now be Villa’s top priority.

The claret and blues are desperate to keep hold of their prize asset and have offered him a bumper new deal, but they will have to fend off the advances of Manchester City who are set to up their opening £20million offer.

But Merson fears the club could find themselves going backwards if they fail to keep hold of their crown jewel – and reckons they should consider only a “stupid” offer for the PFA Young Player of the Year.

He said: “Looking at it from a business point of view it’s a good deal, but for the fans who turn up every week it’s not good business.

“If they sell Milner I think they can write the top four off. It would be a miracle to get in the top four the season after you sell one of your best players.

“They are three or four players away from getting in the top four, but if you sell Milner and get a couple of injuries then you could be looking at finishing outside the top half.

“It’s worrying. I’d have said give us £50million if you want him, otherwise he’s staying.

“It’s stupid money but that’s the way it’s got to be.”

Merson, who was at Villa from 1998 to 2002, fears Milner’s departure would send out the wrong message to other key players like Ashley Young.

He said: “They have made him into a player. He was a certainty to go to the World Cup, he was that good this year.

“But if he was to go you would then have people like Ashley Young starting to wonder whether they should go.”

Merson also believes Villa need to sign a proven goalscorer if they are to improve on sixth place.

He added: “Villa are a very attacking team, they have a go. They get the ball wide and get it into the box.

“It’s lovely to watch, but they need a goalscorer because considering the amount of chances they get they don’t score enough.”