Liverpool have reportedly emerged as the frontrunners to sign Brazilian midfielder Bernard, with Arsenal previously having been the leading candidates to claim the signature of the player.
It has been claimed the Gunners have reached an agreement for the 20-year-old but, according to SportsDirect News, Liverpool have moved ahead of their north London rivals after Arsene Wenger denied a deal was in place.
Atletico Mineiro are reported to be willing to sell Bernard should they receive an offer of £22 million for the highly-rated youngster, and Liverpool now seem to more likely than Arsenal than match that fee.
Arsenal have more pressing concerns in terms of potential acquisitions, with the Emirates Stadium outfit focusing their resources of the recruitment of Liverpool striker Luis Suarez.
The Gunners have seen two bids for the Uruguay international by Liverpool, with the latest offer affording Arsenal the opportunity to speak to Suarez about a potential move.
Liverpool, however, maintain Suarez is not for sale, with the club's managing director Ian Ayre stating that Arsenal are wasting their time in pursuit of the 26-year-old former Ajax captain.
"The situation with Luis Suárez remains the same. It's never been our intention to sell Luis," he told reporters on Friday.
"As has been widely reported in the media we've received two separate offers from Arsenal for the player and we've rejected those offers. Luis remains a Liverpool player and is here with us in Thailand as part of our squad."