Arsenal are reported to have ended their interest in the acquisition of Vicente Guaita having baulked at the asking price Valencia have placed on the goalkeeper.
The Gunners entered into talks with Valencia on Tuesday as they strive to make reinforcements before the transfer deadline but, according to Goal.com, negotiations broke down over the fee.
Valencia, it is claimed, requested Arsenal pay £17 million to clinch the signature of the 26-year-old, although the north London club were unwilling to outlay such a fee for Guaita.
Arsenal had been prepared to pay £12.8 million for the Spaniard, but now appear set to focus on other targets - despite the player hoping for a transfer to the Emirates Stadium.
Guaita is one of several goalkeepers to have been linked with a move to Arsenal this summer, as Arsene Wenger looks to recruit a player capable of providing competition for his current options.
Wojciech Szczesny has started the season as Arsenal's No.1, although Wenger appeared to be actively searching for a potential replacement for the Pole.