However, speculation later surfaced that the deal had fallen through - something that Coates has now backed up.
"The Lee Cattermole deal is dead. We thought that was going to happen and it hasn't - we're not quite sure why. We thought there was a deal to be done, but now there isn't. You need to ask Sunderland about that," he told BBC Radio 5 live.
Coates also admitted that the club were trying to recruit winger Jonathan Pitroipa from Rennes.