The Chile international has just a year to go on his contract at the Emirates Stadium, and the Gunners are wary of the risk of losing him for free next summer.
And while Arsenal’s preference has been to sell Sanchez abroad, with rumours of interest from Bayern Munich and Paris Saint-Germain, City seem to be his preferred destination.
According to the Daily Mirror, Arsenal have now signalled they could do business with City, but only for a staggering £80m fee for their top scorer from last season.
Sanchez scored 30 goals and contributed 13 assists in all competitions, helping Arsene Wenger’s side to a win in the FA Cup final over Chelsea, though they were disappointing in the Premier League.
Arsenal dropped out of the top four for the first time in Wenger’s reign, and it is little surprise to see Sanchez currently rejecting their offer of a new £300,000-per-week contract.
Alexis Sanchez's Premier League season Games played38Goals scored24Assists10
Antonio Rudiger team-mates hint he won't be the last Roma star joining Chelsea this summer
Chelsea star refuses to show up for pre-season in bid to force transfer
Kylian Mbappe issues latest transfer update from the airport amid Arsenal links
City manager Pep Guardiola signed Sanchez during his time in charge of Barcelona, and is eager to work with him again, though it seems unlikely that the club would fork out such a sizeable fee for a player in the final year of his contract.
It is thought that the Sky Blues will try their luck with an opening offer of £50m for Sanchez, which would still make him a record sale for Arsenal.
The north London giants have already signed Alexandre Lacazette and are targeting Thomas Lemar and Riyad Mahrez in deals to help them replace Sanchez in attack.