For all we know, city made the highest bid, but did not meet the reserveFor all we know City may have asked about the collection, what specific shirts are in the collection, decided not to make an offer, decided make an offer on specific shirts, etc?
I don't think City would be interested in the full collection as the majority of the shirts wouldn't be put on display in the new museum. There's only so much space the club can give over to shirts in the new museum, so the shirts have to be very special, and have to have Important City history behind them.