Chelsea had a £25.7 million bid for Brazilian star forward Barbosa Almeida – also known as Gabigol – rejected by Santos according to Goal.
The report claims that the Blues were joined by PSG and Borussia Dortmund in the race to sign the 19-year-old.
Gabigol decided to turn down a move to Europe in favour of signing a new deal and remaining in Brazil.
Paris Saint-Germain and Borussia Dortmund were also reported to be interested in the Brazil international but his new deal will keep him at Santos until 2021.
Gabigol is tipped as being one of the most exciting players in Brazilian football and is making a name for himself at the same club that produced Neymar before his move to Barcelona.
The 19-year-old forward has found the back of the net 22 times in 78 Brazilian Serie A games for Santos.
Gabigol has scored 54 times in 148 matches in all competitions and has helped Santos win back-to-back Campeonato Paulista titles.