According to The Telegraph, the Gunners are prepared to bid in the region of £50m in an attempt to sign the French international, but Aulas claims that he expects Lyon's top goalscorer to remain in Ligue 1.
He said: "Alexandre Lacazette was told he could leave. We had negotiations with Atletico. Things did not work out. For us he will not leave."
Aulas had previously said that Lyon had received a "very nice offer" for Lacazette, before later insisting that no formal bids had been made.