Both the Gunners and Milan were heavily linked to the central defender after he captained his club to their first ever Ligue 1 title last season.
"Montpellier are really pleased to announce the contract extension of captain Mapou Yanga-Mbiwa,” began a statement on the club's official website. “The defender has chosen to extend his adventure with the club for two further years.”
Given the limited length of the extension, the deal is unlikely to end speculation about Yanga-Mbiwa’s future. Indeed the new contract may purely be a move by Montpellier to ensure that they receive a fee for the player, rather than losing him on a free transfer in the summer.
Another reported Arsenal target remains in a precarious contractual position with his club. Midfielder Lewis Holtby’s Schalke contract is set to expire at the end of the season, although the Bundesliga side have confirmed that they are actively pursuing a new deal.
The club’s sporting director Horst Heldt refused to comment on reports that the 22-year-old had asked for a 300 percent wage increase.
"I cannot confirm today's headlines in the media about Lewis Holtby but we're in a constant, good exchange,” he revealed, according to the Daily Mirror.
Holtby’s representative Markus Noack denied the claims about his client’s wage demands.
“These numbers have been plucked from the air," Noack told Goal.com.
"Ultimately, it was only myself, Horst Heldt and [Schalke sporting director] Gerhard Zuber sitting at the negotiating table. To my knowledge, no media representatives were there, so how would they know?
"The press are building it up more than they should. It could be the club trying to add some pressure because, if I put myself in their position, then I can understand that they might want to panic both the player and his agent. We have seen this in the past."
The Germany international, who has an English father, is also said to be interesting Liverpool and Everton.
In other news, Metro have linked Arsenal with a surprise move for Hugo Lloris of North London rivals Tottenham. The France international goalkeeper only moved to White Hart Lane from Lyon in the summer, but has largely been overlooked in Premier League matches for veteran Brad Friedel.
Recent reports have suggested that Gunners boss Arsene Wenger is looking to bring in a stopper to provide competition for or even replace Wojciech Szczesny and Lloris was linked with a move to the Emirates earlier in the summer.
Lloris, 25, has said that the current situation is not an easy one.
“Everything's possible. It's a difficult time and hard to accept. I'm trying to stay professional,” he said, according to Metro.
“I feel good at Tottenham. I've been well received by players, fans and people at club. As for questions [regarding being first choice] you have to ask the coach.”
Finally, there has yet to be any progress over contract negotiations with Arsenal winger Theo Walcott. The England international’s deal is set to expire next summer and he reportedly turned down the club’s offer in August.
"We have discussions every day about his contract,” Wenger said, according to Sky Sports.
"We try to get further along but nothing else has happened."