The Blues had been linked with Croatian striker last week as Ronald Koeman continues his efforts to replace Romelu Lukaku.
The Dutchman is on the hunt for a target-man type forward this summer and has been linked to the likes of Olivier Giroud and Christian Benteke as a result.
Similarly, Crystal Palace are unlikely to want to sell Benteke given the importance to their hope this season.
AC Milan getting close to deal for Fiorentina forward Nikola Kalinic. Still after Aubameyang too. Could end up as biggest summer spenders— Kaveh Solhekol (@SkyKaveh) August 15, 2017
Kalinic would have been a perfect alternative to both, having proven himself more than adapt at playing the target man role for Fiorentina in recent years.
Unfortunately it seems Everton will face further frustration in their potential pursuit of Kalinic as he is staying in Italy and moving to the San Siro.
The free spending Italians have been dominating the transfer market this summer and having sent Carlos Bacca on loan to Villarreal on Monday are now free to bring in Kalinic.
In truth, the news is not surprising given the initial links had suggested the player did not want a return to England in the first place.
It does leave Everton in a bind, though, with few suitable targets left remaining to fill the Lukaku shaped hole in their forward line at this moment in time.