Sami Khedira has told Real Madrid that he is ready to commit his future to the club by agreeing a new contract, according to El Confidencial.
Such a move would end speculation with regards to a move to Arsenal, which was reported to be just hours from completion at the beginning of the week. Arsene Wenger had placed the 27-year-old high on his priority list, but the battle has been lost.
It appeared that all signs were pointing directly to the exit door for Khedira. Real Madrid have closed a deal to sign Toni Kroos from Real Madrid while the 27-year-old has just 12 months remaining on his current deal. With Kroos set to add plenty of competition next season, the World Cup winner was ready to quit for pastures new.
Not only that, but Khedira had rejected a contract extension from Real Madrid earlier this season. With plenty of Premier League interest, including Chelsea and Arsenal, there was little doubt where he was heading.
That has all changed now, Khedira wants to stay at Real Madrid are keen also. Carlo Ancelotti has told Real Madrid officials that Khedira remains key to his plans regardless of Kroos. Officials will offer him a new deal and he is expected to sign.
There are, however, lingering concerns over offering him a long-term deal because of his serious knee injury. Khedira recovered well from the ligament damage in his knee, but such an injury can have lasting effects for a tough-tackling midfielder like the German.
Reports suggested that Arsenal had bid in the region of £20 million for Khedira. The offer was accepted by Real Madrid and Khedira entered talks with Arsenal. However, the mood changed when he demanded a basic wage of £150,000-a-week. That would have made him Arsenal's highest paid player ever.
Arsenal then spent the best part of a day - reminder that this is all according to Spanish media reports - trying to lower the asking price before the crumbling pillars holding up this rumour came crashing down. The agent of Khedira told the Daily Telegraph that there were no negotiations between Arsenal and the player and no bid had been accepted.
Throughout this four-day saga, Jose Mourinho lurked in the shadows apparently ready to pounce at Wenger's prudence. Mourinho still holds a close relationship with Khedira having helped the player during his three-year stint as Real Madrid manager.