Arsenal transfer news: Alan Smith believes Mesut Ozil is close to signing a new contract with Gunners

Mesut Ozil is close to signing a new deal with the Gunners, according to former Arsenal striker Alan Smith. The midfielder has only six months left on his current deal and has been linked with a move out of the club in the summer.

Barcelona and Manchester United were ready to test Arsenal's resolve by making January bids for Ozil, but are now likely to wait until the summer when they can sign him for a free. However, with Sanchez set to make his way to United, the Gunners are closing in on getting Ozil to sign a new contract, which would be a massive boost for Arsene Wenger as he tries to fashion a sense of positivity among the Arsenal ranks.

Smith, who has close ties with the Gunners, given his long term association with the club, believes that losing both Ozil and Sanchez would have sounded the death knell for the club's future prospects.

The north London club have been busy this January, with a swap deal for Henrikh Mkhitaryan on the horizon and they are also close to completing a move for Borussia Dortmund striker Pierre-Emerick Aubameyang, having already agreed personal terms .

"My sources tell me he is quite close to signing a new contract," Smith told Premier League Daily, as quoted by Sky Sports. "We've not heard much on that and it sounds like negotiations have gone on behind the scenes and he will sign.

"He's been a different player the last couple of months when he's been fit. He's really been putting in a shift, he looks energised, more enthusiasm than he did have and he looks the player that we all think he can be on a consistent basis.

"If he does sign you just want him to continue that. You hope he is not playing in this fashion because he wants to win a new contract.

"He's a top player and to lose Sanchez is bad enough but if you lost Ozil as well, that bit of creativity, it would almost be a mortal blow, a real kick in the teeth for Arsenal."