Tottenham have reached an agreement with Real Madrid over the transfer of Luka Modric, the Premier League club have announced.
The Croatia playmaker made 160 appearances for Spurs, scoring 17 goals, and moves for a fee reported to be £33million.
"Luka has been a terrific player for us," said Tottenham chairman Daniel Levy.
The transfer is subject to a medical with Modric signing a five-year contract.
The clubs have also agreed a new partnership that will see them work together in respect of players, coaches and commercial relationships.
"While we preferred not to part with Luka, we are pleased that it is to Real Madrid, a club with which we now look forward to sharing a long and productive partnership," said Levy.
Real Madrid president Florentino Perez welcomed the decision for the clubs to work more closely together.
"The strong relationship and affinity between our two clubs has resulted in the cementing of a longer-term partnership and the successful transfer of Luka Modric," he said.
"We are delighted to welcome Luka and look forward to working closely with Tottenham in the coming years."
The money raised from Modric will fund Spurs' pursuit of Brazilians Willian of Shakhtar Donetsk and Internacional's Leandro Damiao.
Willian was yesterday left out of Shakhtar's squad for their league game against Karpaty, with coach Mircea Lucescu revealing he was not in the right frame of mind.
"Does anyone of you believe that in his current situation his head produces thoughts in the direction of right thinking?" he said to the press.
"I wouldn't like him to play and suffer an injury today, but this could happen. He will have some rest, and then we will see what to do with him.
"We have a week before the transfer window closes, during which, perhaps, everything will be solved."