Arsenal were weighing up a number of options after a day in which both Sergio Aguero and Raheem Sterling were discussed as possible makeweights in the deal for Sanchez.
But City would rather a straight cash transfer and have put in a formal £50million bid to test the resolve of the Gunners board, who still insist the player will see out the final year of his contract.
At the same time, they accept it makes financial sense to cash in on the Chile international, who is away on international duty.
With time running out for Arsene Wenger to spend the money, a potential swap deal involving Aguero was rejected out of hand by City, although Sterling would be sacrificed if the England international expresses a desire to return to London.
City, meanwhile, have global reach into both South and North America through their ‘City Football Group’ and would have no problems getting a medical completed ahead of Thursday’s 11pm deadline.
Arsenal have faced a frustrating summer having missed out on deals for Thomas Lemar and Kylian Mbappe, but may have a late flurry if Sanchez does leave.
The Gunners could go back in for Lemar after Liverpool made a move yesterday and have also been linked with Julian Draxler of PSG.
Arsenal have lost back-to-back games in the Premier League and were humiliated 4-0 by Liverpool on Sunday following the defeat to Stoke and dramatic victory over Leicester on the opening day of the season.
Arsenal are facing an early season crisis with fans already questioning the board’s decision to hand Arsene Wenger a new two-year deal this summer.
And Sanchez has made clear his desire to leave to play Champions League football again and wants to be reunited with former boss Pep Guardiola at City.