Penarol are being linked with former Inter and AC Milan striker Christian Vieri.
Now 37, Vieri has been confirmed as a target for the Uruguayan giants by the club's football director Sergio Perrone.
Perrone's comments sparked a media frenzy over the weekend, which was dampened by Penarol president Juan Pedro Damiani last night.
He said: "We are offered more than 100 players, but Penarol is consistent in its actions, in sports and institutional coherence and this means that we will not continue to evaluate the possible employment of Vieri.
"He is not serving the team or the club at this time."
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