Wolves chairman Jeff Shi decided against triggering the release clause of Enzo Fernandez.
According to talkSPORT, the club have walked away from a potential deal, which would have cost £17 million.
Wolves had sent chief scout Mathew Hobbs to Argentina to try and tie up a deal with River Plate.
But Shi has decided against triggering the release clause of the youngster, for reasons that are as yet unclear.
Benfica are now set to sign him instead, having reach an agreement for 75% of his rights.
The news came as yet another blow for Wolves supporters, who are itching to see a new face come in at Molineux.
Joao Palhinha is seemingly now getting closer to joining Fulham, having long been linked with Wolves.
And it’s gone quite quiet on Matheus Nunes of late, suggesting Wolves may be waiting to sell Ruben Neves first.
Fernandez is one of the hottest prospects in South America, and fans were rightfully very excited about him potentially moving to Wolves.
Perhaps the decision to walk away was ultimately made because Fernandez is staying put at River Plate to play in the Copa Libertadores.
Wolves obviously need to be bringing in players now so they can bed in ahead of the new season.
More frustration for Wolves fans as Shi opts against Fernandez move
Such claims will do little to endear Shi to the Wolves faithful.
Fernandez is a very exciting young talent and would have made a fantastic addition for Wolves at £17 million.
If there is to be a defence of Shi here, it could be that Fernandez was simply unwilling to move right now.
There may have been no changing his mind with regards to playing in the Copa Libertadores.
Wolves may simply not have the money to be spending on players who won’t join the club immediately.