The 34-year-old held talks with Liverpool boss Brendan Rodgers last month, after leaving Dalian Aerbin to become a free agent.
But despite positive discussions with the Reds, Keita opted for a return to Spain and signed for Valencia instead.
“When my agent told me that Valencia called to sign me, I didn’t hesitate for even a second,” Keita said.
“I had very advanced talks with Liverpool, but I wanted to come here and I made that known to my agent.”
Reports suggested Liverpool had already agreed a deal for the midfielder until the end of the season, before Valencia stepped in with an offer at the eleventh offer.
The Reds were unable to complete any business in January, despite being linked with a number of players.
Rodgers had hoped to strengthen his midfielder after an injury to Brazilian Lucas Leiva, who is set to miss a month of the season since damaging his knee in the draw with Aston Villa last month.