Lozano joined PSV in the summer from Mexican side Pachuca and the 22-year-old has enjoyed a prolific season for PSV Eindhoven with 10 goals in 15 games in the Eredivisie.

And his form as an attacking midfielder has caught the eye of Arsenal scouts.

Arsenal are on the hunt for new players with the futures of several members of the squad in doubt.

Alexis Sanchez is out of contract next summer and is increasingly unlikely to sign a new deal.

It means a place opening on the left side of the attack and it appears Arsenal are ready to make Lozano one of their biggest transfer outlays.

According to Mexican outlet Super Deportivo, Arsene Wenger is prepared to make Lozano the expensive Mexican player of all time.

The report says Arsenal will face competition from Everton, who are said to have already made an offer for Lozano’s signature.

Both clubs are keen to complete a move for Lozano as soon as possible with the deal potentially allowing the attacker to finish the year at PSV.

In October, Lozano’s PSV boss Phillip Cocu hailed the Mexican.

Cocu said: "Making and creating something, that is of course his greatest quality.

“He is still a young player and busy learning all facets of European football.

“It’s great to work with him and he has so much quality that he can make a difference.”