Denilson, who signed for Arsenal back in 2006 for a fee of £3.6m, had found appearances hard to come by under Arsene Wenger following the emergence of teenage sensation Jack Wilshere - and the midfielder was subsequently loaned out to his former club Sao Paulo for the duration of the 2011-12 season.
However, with the Morumbi club's president, Juvenal Juvencio, refusing to pay the Gunner's asking price of £4.9m, it now seems likely that Denilson will return to the Emirates.
|15/2||Arsenal are 15/2 with Paddy Power to beat Sunderland 3-0 in their first Premier League match of the season.|
"Denilson won't stay," Juvencio told UOL.
"Arsenal want €6million (£4.9million) for him, but we won't pay that so we expect him to leave soon."
Denilson was a key member of Sao Paulo's team last season, making 30 appearances, but Juvenico admitted that even an extension on his current loan deal would be difficult.
He added: "Of course we will try to get the loan deal extended for another year, but it won't be easy."