Arsenal are close to completing the signing of Bordeaux winger Malcom amid a possible Alexis Sanchez departure this month.
M.E.N. Sport understands The Gunners are confident of concluding a deal for the 20-year-old as they prepare to lose Sanchez amid interest from Manchester City and United.
The M.E.N. reported on Friday United had cooled their interest in Malcom, having also revealed the Brazilian was in discussions with two other clubs. Malcom is learning English in anticipation of a move to the Premier League.
Malcom's likely arrival at Arsenal increases the likelihood of Sanchez leaving this month. The 29-year-old is understood to be desperate to secure a transfer before deadline day on January 31 but City are prepared to walk away from a deal over Sanchez's financial demands.
City's doubts have opened up an opportunity for United, who have shown interest in signing Sanchez on a pre-contract agreement. Sanchez has entered the last six months of his Arsenal deal but Jose Mourinho refused to rule out signing the Chile international this month and described him as a 'phenomenal player'.
"I don't know if ethical or correct," Mourinho said. "The word we can find to be speaking about players of other clubs. If somebody speaks of one of my players to tell we are interested or we are not interested, I wouldn't be very, very happy.
"Sanchez is an Arsenal player, I don't know but probably this weekend he is going to defend Arsenal colours so I don't think it's correct to say things about Alexis Sanchez.
"At the general level what I can say is myself and the Manchester United board, the owners, we don't believe a lot in the January market, we don't believe in signing a player just to sign a player, just to do something, we don't believe in that.
"What we believe really is there are some players in football world if you have the chance to sign them in January, in March or in July, you have to try and that's it.
"But in relation to Alexis Sanchez I don't say a word, the only word I can say is he is a phenomenal player, apart from that an Arsenal player and I feel I shouldn't say much more than this."
Sanchez, who would be available to play in United's Champions League knockout ties, is looking for £300,000-per-week and a signing-on fee of up to £25million, while Arsenal value him at £35m.
Arsenal manager Arsene Wenger finally conceded on Friday 'it looks like Sanchez will not extend his contract'.
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