Colombian international James Rodriguez has agreed to a six-year-contract which will see him earn around six million euros a year and keep him at Real Madrid until 2020.
The Spanish giants Tuesday confirmed Rodriguez's signing from French outfit AS Monaco for a fee believed to be in the region of 75-80 million euros, reports Xinhua.
The transfer makes James the third most expensive signing in the club's history after Gareth Bale and Cristiano Ronaldo and his former club described the transfer as "one of the most important deals in history".
James is another marquee signing for Real Madrid after he won the "Golden Boot" as the top scorer in the recent World Cup held in Brazil. He netted six times, despite Colombia being knocked out of the competition in the quarter-finals and his goal in the round-of-16 against Uruguay was voted the best goal of the tournament.
His arrival follows that of German international Tony Kroos, after the arrival of the World Cup winner was confirmed by Real Madrid last week.
Real Madrid are also close to signing Levante goalkeeper Keylor Navas, another player who excelled in Brazil with the European Champions expected to meet the Costa Rican international's buyout clause of 10 million euros.
Levante president, Francisco Catalan commented that the team from the capital would have to pay the full 10 million euros of Navas' buyout clause.
"The value of the clause is what it is and we have already said no to various offers after what happened in the World Cup and it would not be logical for us to change our posture just because it is Real Madrid," said Catalan.
Navas' arrival at Real Madrid would open the door for either Diego Lopez or Spain international Iker Casillas to depart from the club before the end of the transfer window in August. Real Madrid have already seen midfielder Casimiro move to Porto while young striker Alvaro Morata has joined Italian champions Juventus.
Meanwhile FC Barcelona midfielder Xavi Hernandez returned to training Monday as the Spanish press reports that the 34-year-old will remain with the club for another season after speculation he could end his career playing in either the USA or Qatar.