OL CEO Jean-Michel Aulas confirmed on Sunday that the Gunners have submitted an initial £32m offer for the 22-year-old, who made his 100th appearance for the Ligue 1 club in a 1-1 draw with Lorient.
But Aulas is looking for closer to £47m for the midfielder, who Mikel Arteta is keen to add to his midfield options for the season.
Houssem Aouar: Playing style, strengths, weaknesses
Aouar, Ligue 1 19/20
|FC Av Rating||6.8|
|Pass Completion %||86%|
|Final Third Pass P90||17.1|
|Comp Dribbles P90||3|
|Non-Pen Goal Cont P90||0.32|
What kind of player are Arsenal buying? Well, he's one that really enjoys carrying the ball. Aouar, who played mostly in the centre of Lyon's midfield last season, but who has played off the left in the past, had the most completed dribbles of any midfielder in Ligue 1, with 3.0.
This is Aouar's clear strength. His carries are also very progressive, moving the ball a total of 4,711 yards in total, the fifth highest in the league and in the territory of known dribblers such as Neymar and Angel Di Maria.
With this level of ball manipulation there is dispossession, too - his dribble success rate is around 53% - but his ability to drive deep into opposition territory should not go overlooked.
Indeed he's much more of a dribbler than a passer. His 48 passes P90 on a completion of 86% is pretty average, though his 17.1 passes into the final third is a decent total.
Aouar isn't a player to break up the game; his recoveries and interceptions represent those of a far more attack-minded player, but the raw ability and positioning is quite obviously of a high level.
He could perhaps add more in the final third though his 0.32 non-penalty goal contributions P90 is not terrible. But Aouar's performances in the Champions League are where he really excelled, as Lyon did as a team. His 0.63 non-penalty goal contributions P90 - four assists and one goal - is the best of any midfielder in the competition in 2019/20.
And on the European stage his completed dribbles P90 jumps to a huge 4.4 P90. And his highlight reel of his finishes are really something; Aouar is not a player who scores normal goals.
And it's the European performances that Arsenal fans should focus on. It's here that Aouar has showcased his talent more, leading to praise from Pep Guardiola and Kevin De Bruyne after he had helped knock them out. Is he worth nearly £50m in a depressed, covid market? That's hard to say.
Do Arsenal need Thomas Partey from Atletico Madrid more? The answer there is probably. But Aouar is the type of player that could improve their midfield options, and from that perspective, Arteta's interest is obvious.