Antonio Conte has made the England ace one of his top transfer targets and with Chelsea bidding £40m.

Oxlade-Chamberlain is among a host of Arsenal players - including Alexis Sanchez and Mesut Ozil - in the last year of their contracts who can leave for free next summer if they do not sign a new deal.

He is understood to be tempted by the prospect of a move to Stamford Bridge and was unimpressed with Arsenal’s initial offer of less than £100,000 a week - less than a third of what is on the table for Manchester City target Sanchez.

But the Gunners are believed to be optimistic the 24-year-old will now accept the improved terms and sign up.

Arsenal face a tough task to convince team-mate Sanchez to stay though, with Saturday’s 1-0 defeat at Stoke following a nervy 3-2 opening win over Leicester.

Alex Oxlade-Chamberlain has been offered a new four-year deal at Arsenal

Sanchez did not play in either but Wenger was hoping a flying start would help convince Sanchez the Gunners could challenge for the title this season and persuade him to sign the new £300,000-a-week deal on offer.

City are expected to raise their bid for the 28-year-old to £60m and remain hopeful of getting their man before the transfer closes a week on Thursday.

Meanwhile Arsenal are waiting to see if Inter Milan come in with a £35m bid for Shkodran Mustafi.

They have already rejected an attempt to sign the defender on loan.

But the Gunners could be tempted to sell up if they recoup the money they paid Valencia for the German centre back last summer.

Mustafi made 26 top-flight appearances for Arsenal last season and was first-choice alongside Laurent Koscielny.

But the 25-year-old is understood to have struggled to bond with a number of team-mates.

Wenger could be tempted to cash in if he can find a replacement with the money.