The 28-year-old is about to enter the final year of his contract at the Emirates and has been in negotiations for a significant increase on his current wage of £130,000 a week for some time.
The uncertainty over his future has alerted a number of clubs across Europe, including Manchester City and Paris Saint-Germain, and now German champions Bayern are planning to gazump their rivals with superior personal terms for the Chilean.
According to The Mirror, Carlo Ancelotti's side are prepared to almost triple his current salary with a wage that would outdo the club's current top earner, Robert Lewandowski, who pockets £300,000 a week.
The Bundesliga outfit would offer Arsenal £40m as a transfer fee, a rise of around £8m that the Gunners paid to bring him in from Barcelona three years ago.
Arsene Wenger's side, meanwhile, are still hoping that he will sign a new long-term deal to remain in London and have offered him improved terms of £275,000 a week.
Speaking about his future earlier this week, Sanchez admitted that his agent will decide "the best option" for his future.