”A deal was really close”, a source close to the fighter reported. “They talked a long time, but they just couldn’t finalize a deal”.

On Saturday BJPenn.com reported that Daley had indded signed with Bellator, but sources (MMAFighting.com) quickly shot down the rumor while quoting a unamed Bellator official

A deal with Bellator isn’t completely out of the picture though for Daley as a source close to the fighter told MMAJunkie.com that is still possible for Daley to sign with Bellator but Daley is also looking at other promotions such as other American based MMA promotion Strikeforce and other organizations.

Daley is looking for a new home after being cut from UFC after his highly publisized antics after his bout at UFC 113 with Welterweight #1 contender Josh Koshcheck when he lost a unanimous-decision and then proceeded to deliver a post-fight punch after the final bell clearly rang.

Meanwhile, Bellator is scheduled to kick off their third season next month with a eight-man tournament in the Heavyweight and Bantamweight Divisions. Also a womens tournament at 115lbs is expected. It will be a busy three months for Bellator as they have seven title bouts set to take place over the 12 week spand- (three tournament finalies in new weight divisions, and title defenses from four of the season one tournament winners and champions, who will meet the season two winners.

Now if Daley decides to sign with Bellator, a source close to the fighted stated that Daley would not be looking at a non-tournament fight in season three and then enter the tournament in season four of Bellator. Even without Daley, a welterweight tournament for season four could still happen and is expected to take place in early 2011. This would be Bellators third tournament in that division. (Lyman Good won the first season tournament, the Ben Arksen secured his fight with Lyman Good for season three after winning season two Bellator though has yet to confirm anything past season three.

But it you wont have to wait long to see Daley  in action as he has a one fight deal to compete in Australia against Pride veteran Daniel Acacio at Impact FC 2 in Sydney Australia.