Emile Heskey reckons Liverpool missed a big opportunity when they failed to sign a 'phenomenal' striker during his time at the club.
And Heskey says the decision not to snap up Anelka on a permanent deal was a mistake.
"We really had some great players," Heskey told the Liverpool Echo's Blood Red podcast.
"Milan Baros came in and did really well as a young talent, Nicolas Anelka too, and we were all pushing each other and striving to become better."
Talking about developing a partnership with Anelka, Heskey said: "We did well together and we had a good understanding.
"Everything clicked quite well and he is a phenomenal player. Even then he had a lot to offer.
"I’m surprised that we didn’t keep him but it is just one of those things.
"He was underrated and a lot of people will look at him and say they know how good he was, but a lot don’t realise how good he actually was.
"His ability, how sharp he was, how clinical he was when it comes to finishing, how quick he was - he had everything.
"He was more refined when he came to Liverpool and he was more of a senior player.
"He would only have been about 24 but he had been to Real Madrid and he had played in different countries. "PSG, Real Madrid and Arsenal - he had learned a lot about football and different aspects.
"We were getting a great player and without a doubt, it was one that was missed, not signing him, but you move on and you try and push forward."
That decision to sign Diouf instead of Anelka is often cited as the reason Houllier’s Anfield tenure did not last as long as it might have.