After failing to successfully negotiate a fee with the San Sebastian club for the Spain Under-21 international, Madrid put the matter out of Sociedad’s hands by agreeing to meet his buy-out clause.
The overall cost, made up of the clause and the associated tax penalties, to Madrid is reported to be in the region of 39million euros (£33.6m).
It is further evidence of Madrid investing in youth with Illarramendi joining Isco, another new recruit and a fellow member of the Spain side which recently won the European Under-21 Championship in Israel, at the Bernabeu.
A Madrid statement read: “Real Madrid have signed Asier Illarramendi, who is now tied to the club for the next six seasons.
“The player will be presented tomorrow after undergoing the relevant medical tests.”
Illarramendi rose to prominence at Sociedad last season, playing an important role as they finished fourth in the Primera Division, securing a place in the Champions League in the process.
The 23-year-old said at a press conference: “I want to thank Real Sociedad for everything they have given me. I came here as a child, and leave here as a man.
“I would prefer to say ‘until next time’ rather than goodbye. This will always be my club.”
Sociedad had been hoping to keep hold of their prize asset but, in the end, money talked as Madrid got their man. Illarramendi has spent his entire youth and professional career at Sociedad and admitted he was leaving with a heavy heart.