Allan starred in two previous spells with the Capital club, named Championship player of the year after being signed by Alan Stubbs only to be sold to Celtic at the end of that season.
However, the midfielder has been unable to claim a place in Celtic boss Brendan Rodgers’ plans, going on loan to Rotherham and then Dundee before rejoining Hibs for the second half of last season, helping them to fourth place in the Premiership table as they returned to the top flight.
Although there was speculation throughout the summer that the 26-year-old may move back to Hibs on a permanent deal at a time when Lennon was losing both John McGinn and Dylan McGeouch, Allan remains a Celtic player - but hasn’t featured at all this season.
Asked at the club’s AGM about Allan’s position, Lennon said: “First of all he’d cost money. Second, we had a number of positions we wanted to take precedence and then Emerson Hyndman came to the party and he was a player we quite liked the look of.”
Lennon suggested trying to cut a deal with Celtic might have proved difficult, citing the McGinn who finally moved to Aston Villa in a £2.75 million after Hibs had knocked back three bids from the Glasgow club, and adding that negotiations might have been “a bit fraught”.
Allan is out of contract at the end of the season but will be free to talk to other clubs in January.
Lennon said: “He is a Celtic player and it’s not for me to say whether we would be in for him again come January, but he is a player that thrived here in two spells.”