The Gunners manager is desperate for a new midfielder after losing Samir Nasri and Cesc Fabregas this month, but will need to fork out £20m for M'Vila with £5m add-onsWayne Veysey
Arsenal face a race against time to sign a midfielder before the transfer window shuts, with Rennes star Yann M'Vila still on the club's radar.
The Gunners were in talks with Everton's Mikel Arteta earlier today but Goodison Park sources said on Wednesday evening that the deal has collapsed.
However, Goal.com understands that Arsenal have remained in contact with Rennes about signing highly-rated France international M'Vila.
Arsenal will need to shatter their transfer record to prise the midfielder from the French club, although there are indications that they will pay £20 million up front, plus another £5m of add-ons.
Arsenal have already had a £22m offer for the midfield anchorman rejected and have remained in contact with the Ligue 1 club over the last 24 hours after completing the signings of striker Park Chu-Young for an initial £3m and defensive duo Per Mertesacker and Andre Santos for a combined £14.1m.
The main stumbling block to signing M'Vila is Rennes' £30m asking price for a player who is contracted to the French club until 2015 although Arsenal still have £70m in their transfer kitty following the sales of Cesc Fabregas and Samir Nasri,
is understood that there are no medicals planned at Arsenal's London Colney training ground on Wednesday night and M'Vila will not be heading to London but that would not stop a deal progressing as the necessary medical history can be sent over from France.