Wenger's current contract at the Gunners is due to expire at the end of the current season, but having seemingly come through a difficult period in his tenure to guide the club back to the top of the Premier League table, The Times (subscription required) reports that agreement between club and manager is very close.
Deputy football correspondent Matt Hughes writes:
Arsène Wenger is close to agreeing a new contract with Arsenal that would take his tenure as manager into a third decade. Talks over a new three-year deal, worth £24 million, have been taking place since October and the North London club are increasingly confident he will sign next month.
Wenger has yet publicly to commit himself to Arsenal beyond his existing contract, which expires at the end of the season, but has made it clear to his staff and senior players that he is planning for the long term.
The Frenchman, who arrived in London in 1996, believes that this season’s squad is the best he has had since the 2003-04 Invincibles, who won the Premier League without losing a game. Wenger is determined to stay and lead his emerging team to a trophy.
The club have offered a three-year contract worth £8 million a year, which would make him the second highest-paid manager in the Barclays Premier League, after José Mourinho, and take his length of service to 21 years.
Arsenal have not won a trophy since the 2005 FA Cup, with Wenger indicating in the summer that he would only stay at the club if he continued to believe they were capable of lifting silverware once more.
After the £43.5 million signing of Mesut Ozil and a start to the season that has seen them move four points clear at the top of the Premier League table, success obviously looks a strong possibility in the near future.
Asked about staying at the club last week, Wenger told Sky Sports:
I said many times, that people don't need to question my commitment to this club.
I can just reiterate what I said at the start of the season—I want to feel that I do well, and focus on that.
I am relaxed about the situation. What is important is that the players have the support, to focus on the target which is to do well in every single game.
Yet last season, after a shock Capital One Cup exit to Bradford and a desperate finish to the season to secure Champions League qualification, many both inside and outside the club were questioning Wenger's methods.
Six months on and it looks Wenger is on the verge of agreeing a deal that will see his tenure at the club extend to 21 years.