Rafael Benítez conceded yesterday that he paid over the odds for Glen Johnson, the England right back, but the Liverpool manager is more concerned about trying to avert an exodus from Anfield this summer.

Liverpool are facing a serious battle to retain Xabi Alonso and Javier Mascherano, the midfield players, amid firm interest from Real Madrid and Barcelona, with Benítez acutely aware that the departure of the pair could have a devastating impact on the club's hopes of winning their first league title since 1990.

Real reiterated their intention yesterday to sign Alonso and Álvaro Arbeloa, the Liverpool full back, who is out of contract at the end of next season, and are expected to test Benítez's resolve with a combined £38million bid.

“There we have possibilities but I don't want to say anything that will make negotiations difficult,” Jorge Valdano, the Real director general, said. “We will wait for the right time.”

Valdano angered Benítez when he described the 2007 Champions League semi-final between Liverpool and Chelsea as “s*** hanging from a stick” and criticised the Merseyside club's manager for mistrusting talent because of his own failure to make it as a leading player. But Valdano said that he did not expect any ill feeling between the pair to hamper negotiations.

“What I'm sure about is that Liverpool and Real Madrid are above personal relationships,” he said. “Benítez was here [at the Bernabéu as a coach] and has kept friendships with employees of the club. Personal disagreements matter little in this.”

Real are also interested in Mascherano, but Barcelona may be a more likely destination for the £35million-rated Argentina midfield player, whose pregnant wife does not want to return to Merseyside. “I am very proud and thankful for the interest from Barcelona and Real Madrid,” Mascherano said yesterday.

Sebastián Leto, the Liverpool winger, is close to joining Panathinaikos, Andrea Dossena, the left back, could sign for Juventus and Hertha Berlin want to keep Andriy Voronin, who impressed on loan for the German club last season.

Benítez pushed his gross spending at Liverpool past the £200million mark with the £18.5million capture of Johnson from Portsmouth this week, but he has defended the fee.

“Sometimes you have to spend a little bit more,” Benítez said. “You can't compete in the top four of the Premier League unless you spend some money.”

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