The Gunners are willing to give the right-back a two-year, £75,000-a-week deal with an option for a third year in a fresh attempt to fend off the advances of Serie A side Inter
Arsenal have made Bacary Sagna an improved contract offer in a fresh attempt to keep him at the club beyond this summer.
The Gunners are now willing to give the Frenchman a two-year, £75,000-a-week (€90,000) deal that includes an option for a third year.
The deal would represent a 25 per cent upgrade on the £60,000-a-week (€72,000), straight two-year offer that had previously been on the table, although it still falls short of Sagna's £100,000-a-week (€120,000) demands.
Goal sources in Italy understand that Inter will attempt to trump Arsenal this week by offering Sagna a deal worth £2.35m-a-year (€2.8m) after taxes and deductions, which is equivalent to £90,000-a-week (€108,000) in the UK. The Inter offer would be spread over two years and also include an option of a third year.
Sagna, who turned 31 last month, can leave the Emirates Stadium on a free in the summer and is able to sign a pre-contract agreement with a new club.
In addition to Inter, the France international has offers on the table from Liverpool, Paris Saint-Germain and Monaco.
However, there is growing confidence at Emirates Stadium that an agreement can now be struck with Sagna even though 18 months of negotiations have so far failed to result in a breakthrough.
Sagna and his family are believed to be settled in London and their first choice would be to remain in the capital.
Arsene Wenger wants to hold on to the long-serving right-back, who has been a key figure for Arsenal this season and offers experience and versatility that would not be easy to replace.
The Gunners have looked closely at replacement right-backs in the last year, with Frankfurt's Sebastian Jung currently top of their target list should Sagna decide to leave.
Liverpool boss Brendan Rodgers is an admirer of Sagna, who can operate in central defence as well as both full-back positions, and he is highly regarded in his native France.
Inter are strongly pursuing Sagna amid doubts over first-choice right-back Jonathan, the Brazilian who is well suited to coach Walter Mazzarri's 3-5-2 formation but has struggled when integrated into a traditional four-man defence.
The Serie A club have already signed Nemanja Vidic, who will join on a free transfer from Manchester United in the summer, as they target a number of proven Premier League performers to improve their struggling team.