Last season, the Ivory Coast international was on loan at Nice, where he made just 27 appearances in all competitions, scoring eight goals.
Arsenal paid a then-club-record £72 million to recruit the winger from Lille in the summer of 2019, but he only showed flashes of the potential that drew the Gunners to the Ligue 1 club.
Bukayo Saka’s emergence almost immediately demoted Pepe in Arteta’s pecking order, and with only a year left on his current deal at Arsenal, there appears to be no way back for him.
‘At the moment he is recovering from an injury which is why he’s not here,’ Arteta explained at a press conference ahead of tonight’s friendly against Manchester United.
‘He had a spell on loan and obviously we wanted to get much more than we got from that loan spell.
‘We have to see when we come back, understand what the plans are and make the right decision for him.’
Speaking earlier this month, meanwhile, Pepe confirmed his inteintion to Arsenal and has dismissed claims he had a poor relationship with Arteta.
‘I will return to Arsenal. I was loaned without an option to buy so I have to go back to Arsenal,’ Pepe told YouTube channel Colinterview..
‘I don’t know [about my future] yet. When I get back, I’ll speak with the coach and everyone and see what everyone’s ideas are and then we’ll make a decision.’
On his relationship with Arteta, he continued: ‘People say that he identified me as a player that wasn’t up to the level in his team, in his philosophy. It’s completely false.
‘When he arrived, he had Manchester City’s philosophy. He had a squad that was filled with quality and backups in every position. When he spoke to me, he said he counted on me, he wanted me to do this or that, and you have to focus on that.
‘He improved me in every way. He spoke to me the whole time, I watched videos with his assistants all the time. He really believed in me. He said I had incredible potential, so we need to extract that potential.
‘At the end of the first season, he spoke with me and told me to do this or that. The second season comes along, I was a substitute. I was going mad. How could I be a substitute when he said he counted on me? Everything is spinning in your head.
‘I was a substitute for [what felt like] 10 matches. It was at the time when they signed Willian. He is a number 10 or a winger. But he plays on the wing for like 11 or 12 matches in a row. My head turned, knowing that I had spoken with the coach and it wasn’t like that.
‘I give you this week to pack your things and leave ‘: Arsenal owner Stan Kroenke has officially told £60m Arsenal star to leave this week or His contract will be terminated just as He did to the likes of Ozil and Aubameyang.