According to the Daily Express, Arsenal have opened negotiations over an £8.5m deal for the France under-21 international.
The 21-year-old forward has five goals in his last six appearances for the national team, and was heavily linked with Spurs, Villa, St Etienne and Lille.
But the report claims the Gunners are the only club willing to match Auxerre's valuation on the player. Spurs, Villa and the two French teams will not offer more than £5m for the striker, but Auxerre, facing financial troubles, need more income in the January window to make ends meet.
Arsenal still have their eye on other targets, but it looks increasingly likely that Ntep will follow former teammate Yaya Sanogo from Auxerre.
The Gunners have been linked with a big-money move for a new striker, with the likes of Karim Benzema mentioned as a possible target.
But the article - which is based on reports from France - suggests Wenger has sanctioned a move for Ntep after getting club scouts to monitor his progress closely over the start of the season.