The Red Devils are believed to have made the £38m-rated German their main target between now and the end of the transfer window.
They are said to be confident of completing a deal, with the La Liga giants keen to raise funds as they edge ever closer to securing a world-record move for Tottenham’s Gareth Bale.
But, Wenger is ready to launch a rival bid, as he searches desperately for a marquee signing.
The Gunners have missed out on a number of big name players this summer, including the likes of Luis Suarez and Gonzalo Higuain.
So far, the only arrival at the Emirates Stadium over the course of the last few months has been Yaya Sanogo – a free transfer from Auxerre.
Wenger is said to have a vast budget to spend, and is willing to dedicate half of that to Ozil.
The 24-year-old playmaker is thought of as one of the top players in European football, and is said to be ready to move on in the coming days, with a number of signings at Real having left his first-team role in doubt.
Can Arsenal really compete for Mesut Ozil?
Join the debate below!