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Arsenal have been given a huge boost in their chase for Henrikh Mkhitaryan with Borussia Dortmund set to admit defeat in their fight to keep him.

The German club have failed to persuade the 27-year-old Armenian to sign a new deal.

He has flatly refused to commit himself without a release clause being included in any fresh contract.

Dortmund no longer allow players to include such fees in their deals after Germany forward Mario Gotze’s was triggered by their big rivals Bayern Munich three years ago.

It means the German Cup finalists are now ready to sell Mkhitaryan, who has just a year left on his contract.

Spurs and Chelsea are also interested in the attacker, who scored 18 goals in all competitions this season.

But he has indicated a willingness to move to the Emirates, where Arsenal boss Arsene Wenger is embarking on an overhaul of his squad.

Wenger has already signed Granit Xhaka from Dortmund's Bundesliga rivals Borussia Monchengladbach for £30m and is aiming to land Leicester striker’s Jamie Vardy, having triggered the England international’s £22m release clause.