The Internacional forward had been the subject of Spurs’ interest for the past 18 months, with Tottenham having submitted a £16 million bid for the 23-year-old on deadline day.
However, the club had their offer for the Brazilian rejected and Villas-Boas believes the transfer saga will now be consigned to history.
“The player has been linked recently with Spurs, we’ve made it public before that it’s a player that we chase, but we couldn’t agree on the full conditions so we’ve moved on,” he told reporters.
“Could it [a deal for Damiao] happen in the summer? No I don’t think so, it’s probably finished now.”
The Portuguese manager confirmed that Tottenham rejected a late Reading bid for Icelandic midfielder Gylfi Sigurdsson on deadline day.
He said: “Obviously he’s a player that means a lot to Reading, from their academy.
“He’s a player that Brian [McDermott] appreciates and he probably could have been a big boost for them. But he’s a player that we rate very highly, we couldn’t allow him to leave.”
Villas-Boas also expressed his disappointment that another transfer target, Willian, chose to move to Anzhi Makhachkala instead of the Premier League, suggesting that the Brazilian’s talent would have been welcome on these shores.
He added: “Willian is a very difficult situation because he’s rated very highly by Shakhtar, almost to a point where European clubs can’t compete.
“Obviously his transfer was made by a crazy amount of money and he’s moved on to a league which is the same level as the Ukrainian league.
“It’s a pity that a player of that talent can’t come to a bigger league because I think his talent is up there, but hopefully everything goes well for him.”