The Sun says the Gunners are poised to smash their transfer record with a £15million swoop for Argentinian striker Palacio.
He is destined to wear the No 14 shirt vacated by Thierry Henry's recent £16m move to Barcelona.
Ironically, Barcelona had agreed a £14.9m deal for Palacio just days before learning long-term target Henry was available.
An earlier bid of £12.7m had been knocked back by Boca president Mauricio Macri, who said: "It would have to be a much bigger offer because, for me, he is the best striker in Argentina."
The deal was further complicated by the fact former clubs Huracan and Banfield are both due a cut of the transfer fee.
But now it appears all obstacles have been removed after Arsenal came in with a record-breaking offer.
