Wolves’ chances of signing Craig Gardner collapsed over personal terms, it has emerged.

It is understood Wolves matched the £4.5m fee Sunderland have paid Birmingham for the sharp-shooting midfielder, who was due to be unveiled as the Black Cats’ latest signing in the north-east today.

Gardner was then left with a dilemma over which club to choose.

The former England Under-21 international, whose £25,000-a-week wages were going to remain the same in the Championship, is believed to have initially favoured Wolves.

But Sunderland were able to trump them on the wages they could offer, leaving boss Mick McCarthy to look elsewhere and Gardner to sign a three-year deal at the Stadium of Light.

It is the second time McCarthy has been outbid on Gardner, having also missed out when he left Villa for £3m in January 2010.

And with McCarthy also missing out on Gardner’s Blues’ team-mates Sebastian Larsson – who was unveiled by Sunderland today – and Roger Johnson, the Molineux gaffer is having to think again on his transfer wishlist.

It’s a familiar story for McCarthy, especially regarding dealings with Blues, who have generally paid bigger wages since both clubs were promoted in 2009.

Wolves refused to pay £5m for Johnson two years ago when he went to Blues from Cardiff – now Birmingham want £9m for the 28-year-old. And they were all set to sign his defensive partner Scott Dann, only for Blues to offer him an extra £6,000-a-week to persuade him to go to St Andrew’s.

It remains to be seen where Wolves will take their chase for a midfielder now.

They have an interest in Blackpool’s out-of-contract star David Vaughan, but Albion and Sunderland are favourites to land the Wales international.

Wolves could certainly do with Gardner’s goals, having scored 10 goals in 37 appearances last season.

By TIM NASH