Valencia manager Gennaro Gattuso has admitted that attacker Goncalo Guedes is leaving the club.

According to Tribuna Deportivo, the Spanish club are in negotiations with Wolves over a deal for around £27 million.

Guedes' agent Jorge Mendes is spearheading the move, given his close ties to previous transfers involving Wolves.

The source also adds that Guedes to Wolves may give Arsenal a chance to secure Pedro Neto.

The young winger, who is only 22, was excellent for Wolves in a 2-1 loss to Leeds United in the Premier League this weekend.

The Gunners are serious about Neto, but Wolves may not have been willing to sell until they secured a forward.