Arsenal could have done a deal for Ollie Watkins in the January transfer window, with Aston Villa even seemingly open to the move, according to a report.

With the exception of Sverre Nypan, the one player Arsenal made a genuine attempt to bring in during the January transfer window was Ollie Watkins.
The Gunners ideally would have liked to sign Alexander Isak or Benjamin Sesko, but Isak was completely unattainable and enquiries around Sesko suggested the same was true for him.
Yet James McNicholas reports for The Athletic that Aston Villa were much more open to doing a deal for Watkins in January.

Arsenal and Villa reportedly discussed the possibility at the game between the two teams in January, with Villa likely to sell either Watkins or Jhon Duran before the deadline.
Though the club were already in talks over Duran’s sale, they were willing to entertain Arsenal’s interest in Watkins until that deal was done. Watkins was excited by the prospect of the move.
Mikel Arteta was also very keen, though not everyone at the club agreed. Eventually, they did all decide to pursue Watkins, with Arsenal making a £40m bid, but Villa wanted £60m, and Al-Nassr finalised their deal for Duran soon afterwards.
Arsenal’s intentions to place another bid ended up being irrelevant, as Villa were no longer willing to sell.

It’s hard to say whether an earlier bid of a larger amount would have been successful. Perhaps Villa just wanted Arsenal’s interest in Watkins as leverage in their Duran negotiations, and they never had any plan to let the former leave.
But just as with a potential loan deal for Alvaro Morata, Arsenal’s hesitance meant any possibility of the transfer was definitely gone by the time they made a decision.