The signing is Arsenal's second one of the day after landing Dani Ceballos on loan from Real Madrid.
Arsenal have confirmed the signing of highly-rated defender William Saliba from Saint-Etienne on a long-term deal, before immediately sending the player back to the Ligue 1 side on loan for the 2019/20 season.
The Gunners had been locked in negotiations over a deal for the 18-year-old, with the structure of payments and Saint-Etienne's demands that the player be loaned back to the club making an agreement hard to reach.
A solution has finally been found, however, with Arsenal confirming on their official Twitter account that Saliba has put pen to paper on what's thought to be a five-year deal.
Unai Emery's side fought off late competition from north London rivals Tottenham for the Frenchman's signature, but Arsenal have secured a move for the player who broke into Les Verts' first team last season, making 16 appearances in Ligue 1.
The fee for Saliba is rumored to be around the €30m mark, with Saliba heading back to Saint-Etienne on a season-long loan to continue his development.