Arsene Wenger is planning to fast-track promising youngster Serge Gnabry into the Arsenal first-team set-up, should Theo Walcott leave the club in January, reports the London Evening Standard.
The 23-year-old England international continues to hold out for an improved financial package than what is currently on the table - a bumper new five-year deal, worth around £75,000-a-week - and is also seeking assurances he will be considered for a central striker role.
Walcott is keen to stay at the Emirates Stadium, but is even more determined to embark on the same transition from winger to centre-forward that was made by Gunners legend Thierry Henry at a similar age.
Arsenal remain confident that Walcott - who arrived in north London from Southampton in 2006 - will commit his future, even though he has become disillusioned with his role at the club, after starting just one Premier League game this season, and completing only one full 90 minutes, against Coventry City in the Capital One Cup.
The club's hierarchy want the contract situation resolved one way or another by January, when Walcott will enter the final six months of his existing deal, and thus free to agree pre-contract terms with another team.
Should an agreement fail to be reached, Wenger is confident he already has a competent replacement within his squad, in Gnabry. The 17-year-old made his Premier League debut in last weekend's 1-0 defeat against Norwich City at Carrow Road, capping a whirlwind year of development.
The German youth international is a very versatile footballer, able to play anywhere across the midfield or further forward, and the Arsenal boss is ready to integrate him fully into the senior squad.
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