After the dust has settled down on the Luis Suarez transfer saga, with Liverpool in no mood to sell to a direct rival, Wenger focused on recruiting a defensive enforcer to further strengthen his squad for the new season.

Gustavo was the man linked with the Gunners as the Brazilian seeks a new challenge after being told by new Bayern manager Pep Guardiola that he is not in his first-team plans at the Allianz Arena.

The 26-year-old joined Bayern in January 2011, but after making 100 appearances for the club and winning the treble last season, he is set to depart after Guardiola bought in Barcelona’s Thiago Alcantara as his replacement.

With this being the World Cup year, Gustavo wants to be playing regularly in order to stand a chance to feature for his country at next year’s World Cup in Brazil. He will not have such a chance at Bayern with the plethora of quality players at Guardiola’s disposal and, as such, would favour a move away from the club.

Arsenal had launched a £17 million bid in order to lure Gustavo to the Emirates and were initially handed a transfer boost as the player admitted his desire to play for the English outfit. However, even Wolfsburg held an interest in the player and have reportedly agreed a deal to bring the defence-minded midfielder to the Volkswagen Arena.

According to ESPN, Gustavo has agreed to remain in the Bundesliga with Wolfsburg by declining the chance to join the Gunners.

This comes as yet another blow to the Gunners, who have already lost out on a host of targets this summer, despite showing signs that they can spend big. The likes of Higuain, Jovetic, Cesar, Suarez and now Gustavo have, for a variety of reasons, all failed to agree a deal with the Gunners.

The Gunners have only bought the unknown 20-year-old Yaya Sanogo this summer, and Wenger may need to change his transfer strategy in order to recruit more quality players at the Emirates.