“He’s had an astonishing, astonishing offer from City and we can’t compete with that," Allofs said
"We had to take it seriously and finally we decided to start negotiations with City.
“During the day we have gone on with negotiations and we’ve got closer to each other. But the deal is not already done. So hopefully we will find an end by tomorrow morning.
"I would prefer to keep him, not to get the money. But the money now is really the issue because Kevin was qualified with Wolfsburg for the Champions League and he was a key player and took the next step.
"At Chelsea he was not that good and I know the story because I took him to Werder Bremen two years before and then to Wolfsburg. It will be very difficult - apart from Bayern Munich - to compete with the Premier League in the future.
"It is a big blow if he is leaving Wolfsburg but, you know, it's a difficult situation. Have a look at the statistics. Kevin did I don't know how many assists and he scored 10 goals so he was, he still is, a key player for Wolfsburg. It's really a situation that nobody was thinking about when he started with us."
Ironically De Bruyne’s club-record transfer will help neighbours United by weakening Wolfsburg, who they will face in the Champions League group stages after yesterday’s draw.
And Allofs hit out at the state of play in relation to money in the Premier League compared to Germany.
He added: "Even the last team in the Premier League has much more money than Bayern Munich in TV money so this is already the situation. It's a big task for our football league to get more money out of TV rights and we have to compete with that and hopefully we can."