Former Real Madrid defender Pepe reportedly turned down a move to Arsenal before deciding to join French Ligue 1 club AS Monaco.
According to the publication from The Sun via the Daily Mirror, Pepe opted against an Arsenal transfer.
The 35-year-old became a free agent earlier this month after he was released from his contract at Turkish Super Lig giants Besiktas.
The Gunners were interested in signing him but the Portuguese legend made the decision to team up with sleeping Ligue 1 giants AS Monaco who are battling to survive relegation in the top flight of French football.
Monaco manager Thierry Henry has been attempting to sign experienced players including Pepe to boost his squad in the fight to stay in the French top flight at the end of this season.
Arsenal boss Unai Emery has had to work with a depleted defence in the past months and that’s one area that the Gunners are keen to strengthen in the current transfer window.
The North Londoners will have to turn their attention elsewhere in the aftermath of the failed move for Pepe who was part of the 23-man squad that won the 2016 European Championships in France via a 1-0 win over the hosts.