Arsenal either don’t have the funds to afford Lyon midfielder Houssem Aouar or they aren’t prepared to splash the cash on the player.

That is according to Lyon president Jean-Michel Aulas, who has spoken frankly about the situation surrounding Aouar.

It is thought that Arsenal are desperate to land French youth international Aouar this summer for Mikel Arteta to model his team around.

However, the 22-year-old’s stock has risen significantly thanks to his performances in Ligue 1 and the Champions League.

And Lyon bigwig Aulas has claimed that Arsenal are not ready to make the investment in Aouar just yet.

“No I don't think so, no offer yet,” Aulas replied when asked if Aouar would be leaving the club this summer.

Arsenal are very keen to sign Lyon midfielder Aouar this summer

“It seems that Arsenal don't want to, or can't invest the price for Houssem, who is our best player.”

Lyon sporting director Juninho confirmed that talks had gone ahead earlier this summer - but they were unsuccessful due to Arsenal’s offer to include Matteo Guendouzi as part of a deal.

“I get on very well with Edu [Arsenal technical director], we spoke on the phone. Aouar is really appreciated by Mikel Arteta,” Juninho told RMC Sport.

Lyon president Jean-Michel Aulas

“Guendouzi was discussed during the call, he is a great player, but he is the wrong profile. We are not interested in that at all, we cut the conversation.”

Juninho also confirmed that Manchester City were interested in signing Aouar, but said he wasn’t sure if the player was ready for a club of their stature - or PSG’s.

“I think that has been happening directly with agents,” Juninho added. “We were not directly contacted. Maybe Vincent Ponsot (director general) was contacted by Manchester City, I am not sure.

Get the latest transfer news straight into your inbox!

Want to be on the ball with all of the latest football news?

Well then sign up for the brilliant new Daily Star Sport email newsletter!

From the latest transfer news to the agenda-setting stories, get it all in your email inbox.

How do you sign up?

It only takes a matter of seconds.

Simply type your email address into the box at the top of this article and hit 'subscribe'.

And that's it, job done. You'll receive an email with all of the top news stories every single morning.

You can find out more information on our email newsletter on this link here.

“It is like that with these two teams, two enormous teams who play to win the Champions League every year, they have the capacity for that and that makes any player dream. I don't know if Houssem is ready to change project for a big Ligue 1 team like PSG.

“For City, of course Guardiola likes the player, but is that the profile that they are looking for today? We don't know that either and we have not received any official offers.”