City have been given permission to speak to Dias about a deal that could see Nicolas Otamendi join Benfica.
Pep Guardiola has already added defender Nathan Ake to his squad this summer, but City are set to splash out on another centre-back to further bolster their defence.
Sources told ESPN on Friday that Sevilla remain braced for a second, improved bid from City for Jules Kounde. They rejected an initial €55 million City offer for Kounde last week, believing they'll be able to sell him for more next summer.
The 23-year-old, who has been capped 19 times by Portugal, is set to arrive in Manchester this week to finalise the move.