20-year-old Argentina international confirms Arsenal transfer interest

Argentina international Exequiel Palacios has confirmed he is the subject of Arsenal interest.

The 20-year-old River Plate talent has been heavily linked with the Gunners and is considered one of the top prospects emerging from South America.

He came close to joining Real Madrid last summer before injury scuppered the move but he's one of three players based in Argentina said to be on Unai Emery's shortlist.

Palacios, who has suffered Copa America heartache with a hamstring injury forcing him to withdraw from the Argentina squad, revealed he is wanted by Arsenal - but admitted Real Madrid are also still keen.

Asked about his future, Palacios declared: "I’m proud clubs like Real Madrid and Arsenal are interested in me."

Palacios played a key role in helping River Plate defeat arch rivals Boca Juniors in the Copa Libertadores final and is considered a top young talent.

His release clause reportedly stands at £18m, although Real Madrid were reported to have agreed a £20m fee last year.

Signing Palacios could eat up a chunk of Emery's restricted transfer budget after they missed out on a spot in the Champions League.

But the Spaniard is still hopeful of offloading big earner Mesut Ozil and other unwanted stars in order to overhaul his squad.

With a lack of Champions League football impacting their ability to draw in star names, Emery appears to be looking to South America.

He's also been linked with Boca Juniors midfielders Nahitan Nandez and Emanuel Reynoso, as well as defender Walter Kannemann from Gremio.