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Mikel Arteta rejected Arsenal’s approach to become their next manager, according to Sky Sports reporter Kaveh Solhekol.
Former Paris Saint-Germain boss Unai Emery is now set to be announced Arsenal manager by the end of the week.
Arteta was the overwhelming favourite to become the next Gunners boss.
But it now appears the Manchester City coach and former Arsenal captain has had a change of heart.
Solhekol claims Arteta had concerns over the transfer budget for this summer, which was said to be only £50million.
He says the Spaniard also had “other issues” which prevented him from taking the job.
“What we are being told is that Mikel Arteta has withdrawn from the process to become the next Arsenal manager,” Solhekol said on Sky Sports.
“What that means is the PSG manager Unai Emery is now the No 1 choice to be the next Arsenal manager.
“That is what one source is telling us, one source that is giving us very good information throughout this process.
“He had concerns, we were told, about the fact that the transfer budget he was going to be given this summer was about £50m.
“Also he had ‘other issues’ which is what we’re being told about taking the job.
“What that all means now is that Unai Emery is the No 1 choice to be the next Arsenal manager.”