Arsene Wenger claims Arsenal can commit £80million to sign Radamel Falcao as they prepare for a radical change in their spending policy.
The Arsenal manager, under pressure from fans after his side were taken apart by Bayern Munich in the Champions League, will be given an unprecedented budget in the summer.
He claims Arsenal could meet an expected £40m asking price, if Atletico Madrid agree to sell Colombia striker Falcao, and could also match the 27-year-old’s £40m wage demands.
Wenger, preparing for Saturday's Barclays Premier League clash with Aston Villa, said: ‘We can do it (Falcao). If we find a player of top, top quality we will take him.
‘We are in a stronger situation where we can spend some money. I’m not reluctant to do so. First of all, we only had money recently. We went out to spend money at Christmas but we didn’t find the players.’
Despite being outclassed in Tuesday’s 3-1 defeat, Wenger added: ‘We are not as far from Bayern as people think. In some areas of the team we can compete with anyone in the world. With Jack Wilshere and Santi Cazorla we have a very strong technical basis, but we need to be more efficient.’
Arsenal have £150m in cash which will be augmented in the summer by their £150m, five-year shirt sponsorship deal with Emirates. Their Champions League run, which is likely to end in the Allianz-Arena in the second leg against Bayern on March 13, is worth another £26m this season.
Wenger, who has been at the club for 16 years, is under intense scrutiny from supporters but insists he will see out his £7.5m-a-year contract, which expires next year.
He added: ‘I have never thought about throwing in the towel. I love winning, so I will carry on. I have a contract until 2014 and I will be here until then. I will make a decision on my future in 2014, not before.’
Wenger received the full backing of the club’s board on Thursday. But he described a sombre mood following the Bayern drubbing, saying: ‘The meeting wasn’t exactly euphoric. Everyone is disappointed within the club about the result but we will not allow one game to change the guidelines. We operate within them and talked about lots of things. I gave my technical report and we discussed some long-term planning.
‘When we moved to the Emirates I was prepared for some suffering. The main target was to be in the Champions League.
‘Financially we can afford to miss out on the Champions League, but we cannot afford to miss out for sporting reasons.
‘Trophies for me are the Premier League and the Champions League because they are of higher quality.’
Meanwhile, Arsenal are refusing to increase Bacary Sagna’s initial contract offer because of fears over his long-term fitness.
Sportsmail can reveal the France defender has complained increasingly of knee problems in recent months. Sagna will miss today’s visit of Aston Villa with a knee injury — the first noticeable sign that the problem is catching up with him.
And the Gunners medical staff fear the problem could hinder the remainder of his career.
In addition, Sagna suffered two broken legs last season, adding to concerns over his long-term fitness.
The 30-year-old has already turned down a 12-month extension to his current contract, which would take him up to 2015. The offer does not include an increase to his current £60,000-a-week wages.
Sagna has privately conceded his Arsenal career is likely to end this summer and his advisers are considering Paris Saint- Germain and Inter Milan as options.
Arsenal have already begun identifying a replacement for Sagna, with Feyenoord’s Daryl Janmatt and Toulouse’s Serge Aurier having both been scouted extensively.
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