Arsenal remain in talks with Manchester City regarding the appointment of former player Mikel Arteta as their new head coach.

The Gunners fuelled speculation of an imminent announcement of Unai Emery's permanent successor by postponing Thursday afternoon's scheduled press conference.

However, the PA news agency understands negotiations regarding compensation for the Manchester City assistant coach have yet to be concluded.

Spaniard Arteta, who played for the Gunners from 2011 to 2016, reportedly said his farewells to staff at City on Thursday morning.

Later in the day, interim Gunners boss Freddie Ljungberg was expected to face the media at his club's London Colney training ground to preview Saturday's Premier League game against Everton.

The Swede, another former Gunners player, has been placed in temporary charge since Emery was sacked on November 29, but has overseen just one victory in his five-match tenure.

Arsenal sit seven points adrift of fourth-placed Chelsea and the same number clear of the top-flight relegation zone following Sunday's 3-0 home defeat to Arteta's current club.

That result led to the Gunners' hierarchy stepping up their plans to recruit Emery's long-term replacement, with managing director Vinai Venkatesham pictured outside Arteta's house in the early hours of Monday morning.

It is understood City are unhappy that Arsenal did not ask for permission to speak to Arteta and are especially annoyed because no approach was made when club officials met for last weekend's fixture at the Emirates Stadium.

City, however, do not have an issue with the 37-year-old and will allow him to make his own decision.

Arteta was alongside City boss Pep Guardiola on Wednesday night as the Premier League champions won 3-1 at Sky Bet League One club Oxford to reach the Carabao Cup semi-finals.

Post-match, Guardiola insisted: "There was no change. I don't have any news. We prepared the game as best as possible. Before, during and now after and we did it.

"I spoke (Tuesday), my press conference I had 48 questions and 35 were about Mikel so I don't have to say anything more until there is news.

"When there is news, in my next (press) conference when you ask me something I will answer."

Arteta made 110 league appearances for Arsenal before retiring in 2016. He is poised to take up his first managerial role after three years as Guardiola's assistant.