The Gunners have been scouting the 24-year-old for years, and were reported to have been in contact with Borussia Dortmund over a possible transfer.
It is also reported that Arsenal have finally put a bid on the table worth £15.6 million, with Dortmund considering to accept the offer.
It is believed that the two clubs are set to begin negotations in the coming days to discuss terms, though it is understood that Arsenal are determined to sign the German midfielder as soon as possible before the transfer window ends.
By Ollie Carroll
Twitter: @Ollie_Carroll_