25-year-old Croatia worldwide Kovacic moved to the Bernabeu for £25 million in 2015 from Inter Milan, although rather unsurprisingly he has struggled to dislodge Los Blancos superb midfield triumphant of Luka Modric, Toni Kroos, and Casemiro.
Inter, who are willing to pay whatever it takes to land Modric, want to sign the player for €15m on a loan and then €20m next summer to make it permanent.
"The president [Florentino Pérez] spoke resoundingly and we do not have the slightest doubt that he [Modric] will continue to be happy playing with us".
Marca reported that Kovacic is "in rebellion" and will not return to training until his wish to leave the Bernabeu in search of more regular first-team football is granted.
Kovacic joined Madrid from Inter Milan in 2015 and has made over 100 appearances for the Spanish giants over the last three seasons, yet he started just 10 La Liga matches last term.
"I've not seen that he's gone on strike", Lopetegui said.
"[Kovacic] has trained with his team-mates as usual and there has not been the slightest problem, I love him and we are delighted that he is among us". He has developed himself as the premier midfielder in the side alongside German star Toni Kroos.
"I see this is an opportunity to move forward as a collective, and fulfil the demands at this club".