The former England worldwide, Smalling has played a number of games this season for the club, appearing in 31 games.
The paper claims Fekir has emerged as one of Wenger's top targets this summer and is prepared to meet the £45million asking price on his head.
Arsene Wenger is readying a massive bid for the 24-year-old - who is likely to be in France's World Cup squad in Russian Federation.More news: Conte happy to have selection headache for Barcelona clash
Fekir scored in Lyon's 3-1 win over Villarreal on Thursday night taking his tally for the season to 21 goals.
The 24-year-old has come into his own this term with standout performances in different areas of the pitch, including central midfield, from where he put in a man of the match versus Paris Saint-Germain last month.More news: 'Peace Derby' abandoned after 10 red cards and one 'obscene' goal celebration
Fekir has also been linked with Liverpool and Barcelona among others but Real Madrid appears to be his dream destination.
Arsenal are likely to return for the Northern Ireland defender in the summer if West Brom go down and he also interests Manchester City and Leicester.
Arsenal brought in Henrikh Mkhitaryan and Pierre-Emerick Aubameyang during the January transfer window, but after loosing Olivier Giroud, Theo Walcott and Alexis Sanchez, further attacking flair is definitely needed.More news: Manchester United draw Brighton in FA Cup quarterfinal
- SpaceX's Satellite Broadband Receives FCC Chairman's Support
- 'Cruise from hell,' some kicked off Carnival ship after massive brawls
- Atlanta Screening Accidentally Shows Fifty Shades Freed Instead of Black Panther
- IPhone X Slow Sales are Taking Samsung Down with Them
- Former Trump campaign aide Gates to plead guilty, testify against Manafort
- Samsung Reveals Reason for Sudden Stopping of Android 8.0 Update
- Helmut Marko plays down Red Bull's title chances!
- GTA Online Marks Tax Season by Giving Away Millions in (Virtual) Cash
- Presidents Day or Washington's Birthday?
- Sth Korea region eyes Asian bid with North