Real Madrid 's Alvaro Morata celebrates his goal against Almeria during their Spanish first division soccer match at Santiago Bernabeu stadium in Madrid, April 12, 2014.
Alvaro Morata Reuters

Arsenal have suffered a setback in their pursuit of Real Madrid striker Alvaro Morata after reports in Spain claimed Wolfsburg have submitted a €20m offer for the player.

According to Daily AS, the German club want to strengthen their team this summer with a striker and are willing to invest a lot of money on the signing.

Wolfsburg's general manager Klaus Allofs recently said the Bundesliga club are not targeting a move for Morata. However AS reports that Wolfsburg president Francisco Javier Garcia Sanz has since travelled with Allofs to Madrid to try to negotiate a deal.

Real boss Carlo Ancelotti confirmed that the 21-year-old would be allowed to leave the club this summer after growing frustrated with his lack of first-team opportunities last season.

Last week Alvaro Morata's agent, Juanma Lopez, met with Real to discuss the young striker's exit route. The agent is keen to finalise an agreement that will allow the player to leave the club for €20m without any buy-back clause – but Real are not willing to accept this.

Lopez attended with partner Beppe Bozzo, whose presence is significant as he collaborates with Giuseppe Marotta, the general director of Juventus – who have also reportedly made an offer for the young striker.

Juventus are thought to have offered €18m for Morata, €2m less than Wolfsburg, and both club's offers are thought to contain a buy-back clause, Real's main requeriment to make the transfer possible.

However, AS claims the Italian giants have offered a €2.2m a year contract and Morata's preferred destination is Turin.

Morata was close to joining Arsenal on loan during the January transfer window only for Ancelotti to block the deal as he did not have a replacement lined up for the second half of the season. But the situation has since changed and the Real boss has confirmed Morata is likely to leave the club this summer.