Chelsea signed England Under-21 forward Cole Palmer from Manchester City on Friday in a deal worth an initial £40 million ($50 million).

Palmer agreed a seven-year contract with Chelsea, who have a club option of a further 12 month extension and could pay City an extra £2.5 million in add-on clauses.

City were keen to keep Palmer, but the size of Chelsea's offer eventually persuaded them to cash in on a rising star who was keen for more regular first-team opportunities.

The 21-year-old could make his Chelsea debut in Saturday's Premier League match against Nottingham Forest at Stamford Bridge.

"I’m excited to get started and it feels great to sign," Palmer said.

"I’ve joined Chelsea because the project here sounds good and because of the platform I will have to try to showcase my talents. It is a young and hungry squad and, hopefully, we can do something special here."

Palmer's move to the Bridge takes Chelsea's spending in the 16 months since Todd Boehly's Clearlake Capital consortium bought the club to over £1billion.

He is the 12th player to be signed by Chelsea since the end of last season, with his arrival coming after Blues boss Mauricio Pochettino stated he was keen to sign another forward.

"Cole arrives with the experience of winning the Premier League and Champions League and adds further quality and versatility to our attacking unit," Chelsea co-sporting directors Laurence Stewart and Paul Winstanley said.

"He has showcased his talent and potential in the most challenging environments and delivered on the international stage for England at the European Under-21 Championships.

"He is undoubtedly ready for this next step and we are delighted it will be with Chelsea."

Palmer graduated from City's academy and helped them win the FA Youth Cup in 2020, scoring in the final against Chelsea.

Establishing himself as a regular in the City squad last season, Palmer made 25 appearances in all competitions as Pep Guardiola's side won the Premier League, Champions League and FA Cup.

Palmer also enjoyed success alongside his new Chelsea teammates Levi Colwill and Noni Madueke as England won the Under-21 European Championship earlier this year.

He had underlined his vast potential with goals in City's Uefa Super Cup victory against Sevilla and their Community Shield loss to Arsenal this season.