Arlauskis arrived at Vicarage Road from Steaua Bucharest during the close-season, but was back-up to Heurelho Gomes - making one appearance in the FA Cup and featuring once as a substitute in the Premier League.

Watford signed Costel Pantilimon from Sunderland this month and the Romanian's arrival meant Arlauskis would have been third choice under Quique Sanchez Flores.

The 28-year-old Lithuania international will instead spend the rest of the campaign at Espanyol, who sit 13th in La Liga.

Espanyol also have an option to purchase Arlauskis at the end of the season.