The 27-year-old has been heavily linked with a move to the Premier League this summer, amid rumours of unrest at the Ramon Sanchez Pizjuan Stadium.
Gunners boss Arsene Wenger has been credited with an interest in bringing the Spain international to the Emirates Stadium when the transfer window reopens on July 1.
However, Arsenal will now face stiff competition to secure Navas's services, after Manchester City emerged as contenders for the £25million-rated wide-man.
Roberto Mancini is keen to bolster his attacking options at the Etihad Stadium ahead of the 2013/14 campaign, and with Scott Sinclair deemed surplus to requirements the Italian tactician has turned his attention to the Sevilla star.
Navas has been with the Primera Division club since 2003, and has a £30million buy-out clause written into his current contract, but it's understood that head coach Unai Emery is willing to listen to lesser offers for the forward.