Giroud, who has scored 13 times this season, has caught the attention in his side's surge to second in Ligue 1 at the winter break.
Newcastle, who have signed several players from France in the last 18 months, had been linked with a move for the 25-year-old.
They are no longer in the market for a striker in January but Nicollin suggested they were never an option.
Although he could not rule out selling to a club like the Gunners, the presence of Robin van Persie and a sizeable asking price point toward the player staying.
"Newcastle? They are too small for him," he told television station RTL.
"Arsenal? You would have to see if Arsene Wenger is interested but, as before, there is Van Persie.
"And at 10million euros? No. Given that he still has more than two years of contract, it will cost more.
"He has a contract until 2014, [so] 50 or 60million euros at least."