Penarol midfielder Federico Valverde is in Madrid this week to finalise a move to Real Madrid.

The 16 year-old had trials at Arsenal in January, but is set to sign with Real, says El Observador.

Valverde touched down in Madrid on Tuesday to have a Real medical and to pen terms with Real.

Real will cough up an initial €4 million to Penarol for the midfielder, with another €2 million due based on his progress.

Valverde is understood to have trained with Zinedine Zidane's Castilla squad during his visit.