McGarry is a former football journalist and now a leading pundit on The Transfer Window podcast.

It's his understanding that Sanchez has given the green light on terms of a contract at the Etihad.

It is now up to Arsenal to find a replacement for the deal to go through.

Asked how much Sanchez was worth, McGarry said: "We've got to do a quick contextualisation on Alexis Sanchez.

"It's six months until he's out of contract and obviously we are in January so his price is related to that.

"I think Manchester City are prepared to pay up to £40m for him and I believe the terms of his contract has been agreed.

"It's just about whether Arsenal can get someone into replace him in the January window, much like it was in the summer when the Thomas Lemar deal fell through.

"His pricetag doesn't increase because of Virgil van Dijk - it increases because of his contract situation."

Manchester City are the favourites to sign the Chilean, whether that is for free in the summer or in a cut-price deal this month.

Former Premier League star Shaka Hislop was this week asked whether City’s rivals Manchester United could make a move to sign Sanchez and his Arsenal team-mate Mesut Ozil, who is also out of contract in six months.

However, the former West Ham goalkeeper agrees with McGarry and says Sanchez moving to Old Trafford is out of the question as he has already made it clear to City he would join them.

“I think Sanchez has already committed to City,” Hislop told ESPN.

“I don’t see United jumping the queue there.”