This could see him quit the Emirates at the end of this season.
Spanish giants Barcelona and Real Madrid have been put on alert after Fabregas turned down the chance for talks of extending his current contract.
Arsenal wants Fabregas to sign a two-year extension to his deal and offer him a £35,000-a-week pay hike. The new deal would see him stay at the Emirates until 2014.
Fabregas wants at least £100,000-a-week to stay at Arsenal.