Bayern Munich have backed out of the race to sign Arsenal forward Alexis Sanchez this summer, according to the Mirror.
The newspaper claims that Bundesliga champions are not willing spend a huge amount of money for the 28-year-old Chilean with Arsenal reportedly demanding in excess of £50million.
The report also claims that Sanchez is demanding to be the highest-paid player at the German club next season as he wants them to offer him a contract worth more than £350,000-a-week.
It is reported that the Bundesliga side have decided to cool their interest in the forward unless he is willing to significantly lower his wage demands.
The Mirror claims that Manchester City are now the favourites to land Sanchez this summer but Arsenal are desperate not to sell him to a fellow Premier League side.
City manager Pep Guadiola is reportedly in search of a striker as he feels that his side wasted a number of chances last season which saw them finish in third place.
It is understood that the Gunners have offered the Chilean a brand new contract worth more than £275,000-a-week but they are far from confident that he will put pen to paper on the deal.
Sanchez enjoyed his best campaign in terms of numbers at the Emirates Stadium, contributing with 30 goals and 11 assists in all competitions last season.
The forward is currently away on international duty with the Chile national team who are competing in the Confederations Cup in Russia.
Sanchez’s current contract with the Gunners expires at the end of next season.