Arsenal have been strongly rumoured to be interested in Valencia defender Shkodran Mustafi, but a deal for the German defender has stalled, leaving Arsenal to assess their options.
It is claimed that Arsenal have opened talks with Atletico Madrid over the signing of defender Jose Gimenez whose buyout clause is set at £56million.
However, Arsenal are not prepared to meet that valuation and have opened talks with the Champions League finalists in order to try to negotiate a deal for the Uruguayan defender, although it is believed that Atletico Madrid will still demand at least £40million.
The 21-year old defender played 37 games for the La Liga club last season and is thought to be open to the idea of a switch to the Premier League, although Arsenal are not keen on meeting the £40million asking price.
Arsenal are already balking at the £26million asking price for Valencia defender Mustafi, who have admitted they need to sell players to comply with Financial Fair Play regulations.