Walters, 19, was offered a new deal by Arsenal but decided it would not be the right next step for his development.
If Walters' exit is by mutual consent, then no training compensation would be due to Arsenal.
Walters, who also holds a German passport, has been monitored by clubs in the Premier League, Championship, Germany, the Netherlands, Spain, Italy, and Belgium.
He was voted Arsenal's Academy Scholar of the Year for the 2022-23 season and has been highly rated by the academy staff.
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