Brazil forward will sign new deal on Friday.
Out of favour Spain midfielder is a a January target for Milan.
Premier League leaders accused of trying to poach Argentinian youngster when he was only 15.
Fifa upholds transfer ban which means neither Madrid club can sign new players until 2018.
Premier League spending dwarfs that of rival European leagues.
David Luiz's return to Chelsea from Paris-Saint-Germain was the most expensive and also most surprising of the transfer deadline day deals.
London club spend £23m on 25-year-old left-back.
Leicester agree to meet release clause of Euro 2016 winner.
Brazilian defender linked with a return to Stamford Bridge.
Forward becomes Arsenal's third capture of the summer.