。
She wants to keep him at arm's length.
Literal
She [topic-は] him [object-を] want-to-distance [quotative-と] is-thinking.
An important pattern for learners: ~たいと思う (literally 'thinking I want to') is the standard way to express desires in Japanese, especially for third-person subjects. Direct ~たい alone is normally restricted to first-person ('I want to'), since you can't claim direct knowledge of someone else's internal desire. Embedding it in ~たいと思う ('thinking that one wants to') makes the report indirect and grammatical for any subject. 遠ざける ('to keep at a distance') is the transitive counterpart of intransitive 遠ざかる ('to move away').