Blues' hopes dashed...
The deal was confirmed on Thursday in a meeting held at the club headquarters, with Neymar, agent Wagner Ribeiro and the Santos President Luis Alvaro Oliveira the only parties present.
There the 18-year-old signed the new deal; lasting five years and earning the youngster a reportedly staggering £36 million.
Santos president Luis Alvaro de Oliveira Ribeiro told reporters: "Football is not only driven by money. It's part of an entertainment industry, but also driven by passion. This decision proves that a 18-year-old boy can take a balanced attitude of a man that loves what he does."
The striker added: "It was a complicated and difficult decision. I'm staying at Santos and I'm very happy here and now I'm focused to win more titles.
"Money doesn't just bring us happiness."
The player's representative Ribeiro, earlier strongly in favour of a European move, praised the superhuman efforts of the Peixe to keep their brightest star in Brazil.
"The deal offered by Santos for Neymar is incredible. Viewed outside of Brazil, how it was arranged here with half the training and including all the assistance to the family. I've never seen anything like it", the agent affirmed.
The new agreement means that Chelsea and other European clubs will have to wait until the end of the 2011 Copa Libertadores if they wish to tempt Neymar once more.