Arsenal could lose Theo Walcott for just £400,000

Arsenal run the risk of losing England star Theo Walcott for just £400,000 after dragging their feet over a new contract.

Real Madrid, Manchester City and Chelsea are all aware of the amazing transfer loophole and are keeping tabs on the situation.

FIFA rules mean that any buying club would just have to pay £80,000 training costs for every year that Walcott has been at Arsenal which would equate to just under £400,000 by the time his contract expires in the summer of 2010.

Walcott, 19, is frustrated that Arsenal have been slow to discuss a new deal even though his current contract has just 18 months left to run.

Arsenal have held just one meeting with Walcott's advisers and have yet to make him an offer - even though he has become the English game's hottest property.

Walcott established himself on the world stage after scoring his England hat-trick in Croatia last year.

The teenager, who joined from Southampton for an initial £5million transfer fee in January 2006, is the lowest-paid member of the England squad. He is on around £20,000 a week even though his transfer value has rocketed to £20m.

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