The midfielder is set to remain at Stamford Bridge after a fee was agreed between clubs to make his loan move permanent
Chelsea have agreed a fee of £40.3 million ($51m/€45m) with Real Madrid to secure Mateo Kovacic’s long-term future at the club.
The Blues have waited until the last minute to finalise a deal for Kovacic as the deadline to complete a deal was earmarked for June 30, but can now prepare for serious contract talks.
This comes after Derby County granted permission to Chelsea to open discussions with Frank Lampard about the club manager’s role, with the former Blues star expected to return to west London to replace Maurizio Sarri.
Kovacic’s deal can go through despite FIFA imposing a two-window transfer ban on signing senior players in February because Chelsea already held registration documents from his loan spell at the club last season.
The transfer sanctions are likely to remain in place after the club decided against appealing for provisional measures to Court Arbitration of Sport (CAS) to freeze the ban.
Sarri had wanted Kovacic, who played 51 times during his loan spell with the Premier League club last season, but the Croatia international was then left unsure of his future as the Blues manager departed for Juventus.
Luckily for Chelsea, the 25-year-old was keen to remain in London and his imminent move will ease pressure on the new manager, particularly with midfielder Ruben Loftus-Cheek set to miss the start of next season thanks to a ruptured Achilles tendon.
Madrid, meanwhile, have been keen to raise funds having spent in the region of €300 million (£270m/$340m) on five players already this summer, including €100m on Chelsea talisman Eden Hazard.
They remain keen on signing Paul Pogba from Manchester United while a move for Paris Saint-Germain star Neymar is also on the table, and as such players must be sold to ensure the required finances are in place.