The 28-year-old has been heavily linked with a move to north London this summer, but could now find himself priced out of a transfer with little room for negotiation.
Williams's loss might prove to be Thomas Vermaelen's gain, with the Arsenal captain set to be handed a lifeline with regards to his own future at the club.
Instead of looking at an alternative defensive target, Wenger will rely on his current crop of centre-backs - Per Mertesacker, Laurent Koscielny and Vermaelen next season.
The Belgium international lost his place in the Arsenal first-team after a downturn in form last season, but now it looks as though he'll be back in contention for a starting berth by the start of the 2013/14 campaign.
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