Reading football chief Nicky Hammond has rejected an offer from Arsenal.
The Daily Mail says Hammond was offered the football director's job on Friday but had a last-minute change of heart and decided to stick with Reading.
Hammond's decision to turn down the job has shocked Wenger while Reading chiefs, too, are surprised that he is staying.
Hammond will now turn his attention to unrest among some Madejski backroom staff over new contracts to fall in line with other Premiership clubs after their first successful season in the top flight.