Cazorla, 32, has been out of action for the majority of the season and is it unclear whether he will extend his contract, which expires next month.
Arsenal need a long-term successor for the Spaniard and they have lined up his compatriot Fornals, who has impressed at Malaga this term. He would be available for a fee of around €12m.
The Gunners are not the only side interested in the 21-year-old – Valencia are also looking to secure his services.
It’s thought that Fornals could be available for as little as £10million due to a release clause in his contract, although the terms of that remain unclear.