Porto has agreed to transfer midfielder Fabio Vieira to Arsenal for 40 million euros (£34.2 million).
Arsenal will pay an initial 35 million euros (£29.9 million) for Vieira, with the remainder coming from future add-ons, according to a statement made by the Portuguese club.
Vieira, who has yet to earn a senior cap for Portugal, was named player of the tournament at the European Under-21 Championship last year.
In the Primeira Liga past season, he had a league-high 14 assists.
Vieira also scored six goals in 27 league appearances to help Porto win the Portuguese top division.
He has 21 caps for Portugal Under-21s and will be the Gunners’ third summer signing, following Matt Turner of the United States and Marquinhos of Brazil.