I think we are in a really strong position here.
He has 3 years on his contract at 20k per week. We paid that to Ireland last year! PL is a tough cookie and I think Lerner and Faulkner will back him to the hilt (as they will be scared of him leaving). £20m sounds very low to me, although I am only guessing. I don't know what players who leave without a transfer request get, maybe 10% or 15%, but that is 2m or 3m on 20m, so quite a chunk.
The only downside of playing hardball is not getting the replacement in. Of course, if we get a replacement in early, that might weaken our position, but for £1m a year in wages, **** him!