Sead Kolasinac has agreed to join Bundeliga side Schalke on loan for the rest of the season.
The Bosnian lost his place to Kieran Tierney for much of the season.
Arsenal confirmed the news on their official site, saying: "Sead Kolasinac has agreed to join Bundesliga side Schalke on loan for the remainder of the season.
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"The Bosnia & Herzegovina international will be returning to the club he joined as a youth player and spent five years in their first team before signing for us in June 2017.
Sead has made 113 appearances for us and his fine performances on our way to the 2019 Europa League final were recognised when he was named in the 2018/19 Uefa Europa League squad of the season. Sead was also part of our FA Cup-winning squad against Chelsea last August.
Technical director Edu said: “Sead needs to be playing regularly, so we have decided together that a move back to Germany with Schalke will benefit him at this moment.
"We will be keeping in close contact with Sead, and wish him huge success for the remainder of the season with Schalke.
"The loan move is subject to the completion of legal and regulatory processes and is effective from January 4."
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Our View - Kolasinac must only be the start of Arsenal clear-out
It's easy to forget that Sead Kolasinac made a good start to his Arsenal career, scoring freely in his early weeks of the club and putting his physicality to good use. Easy because it was over three years ago and Arsenal have dispensed with Arsene Wenger and Unai Emery since and become a midtable club.
Kolasinac has had no shortage of industry for Arsenal but his lapses in concentration often gifted an opposition possession and put his side on the back foot. He came to provide competition for Nacho Monreal, but now he is behind not only Kieran Tierney, but arguably Ainsley Maitland-Niles and Bukayo Saka for a left-back spot, despite the pair of academy graduates not playing there naturally.
Those issues are compounded by his reported six-figure weekly wage bill. Getting rid of him can only be a positive step for Arsenal but there is plenty of work to do. The likes of Sokratis, David Luiz, Cedric Soares, Mohamed Elneny, Shkodran Mustafi and Calum Chambers are also unlikely to enhance the first team's quality and must also be shipped out as soon as possible.
The Mesut Ozil saga is an ongoing similar issue which benefits no-one, while new signing Willian's form has been appalling. Kolasinac's exit is welcome, but plenty of work must be done if Arsenal are to regain their place at English football's pinnacle.