Arsé was NOT a greek city, it is was an Edetani oppida. However, the port town that served it (much like Portus and Ostia for Rome, or Piraeus and Phaleron for Athens) was essentially populated by Greek and Hellenised traders, and was probably their main source of revenue. These guys probably had enough political influence to convince the oppida's leadership to act much like Emporion and other Greek colonists elsewhere, and side with Rome against Carthaginian hegemony.
The fact that it was a major fortification controlling the main coastal road, that would conceivably side with the enemy once hostilities commenced, meant the city would inevitably be subjected to an 8-month siege. There's actually still enough evidence on the extensive punic circumvalation works and even Hannibal's main camp that allows us to reconstruct them with some degree of certainty.
When Hannibal finally destroys the fortified city in 219, killing, enslaving or dispersing its population, the port takes it's place as the major settlement in the area. It's only quite a bit after the Romans take over that the name Saguntum comes into play.
BTW, other Greek settlements include Portus Menusios, Portus Menesthei, Mainake, Heraklia, Alonis, Akra Leuke, Artemision, Hemeroskopeion and Rhode, just north of Emporion.
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