The deal eclipses the £72m Arsenal paid for Nicolas Pepe from Lille in 2019, while it is also a record transfer fee between two British clubs.

But Rice's signing is just short of the British record transfer fee with Chelsea paying £106.8m for midfielder Enzo Fernandez from Benfica in January.

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Rice has signed a five-year deal at Arsenal which runs until 2028, with the option of a further year and will wear the No 41 shirt.

His move to the Emirates Stadium brings a decade-long spell at West Ham to an end, rising from a youth-team player to club captain.

He made 245 appearances for the Hammers after making his first-team debut in 2017 and his final game for the club saw him lift West Ham's first trophy in 43 years after they won the Europa Conference League final.

The 24-year-old's arrival at Arsenal takes their summer spending to £208m following the signings of Kai Havertz from Chelsea for £65m and Jurrien Timber from Ajax for £38m.

The £105m Rice deal is broken down into an initial payment of £100m, which will be paid over 24 months, with £5m in add-ons, which are £1m every time Arsenal qualify for the Champions League and Rice starts 60 per cent of games.

Rice: I believe in what Arteta is building here

Speaking to the Arsenal website, Rice said he was determined to take his game to another level with the Gunners and praised the club's manager Mikel Arteta.

"In football, amazing opportunities arise. Big clubs, like Arsenal, have come for me and it's really hard to turn down," Rice said.

"You only ever get one career and I really believe in what Mikel is building here and the squad he's building. I'm really looking forward to the future with Arsenal.

"With Mikel and how he works, the squad, how young everyone is, the energy around the club and also the challenge of getting Arsenal back to where they belong, that means a lot to me.

"I know the fans really want that. For me as a player, I've come here really hungry to have more success and to spend my best years at this great club.

"I know he [Arteta] is going to get the best out of me. I know I've got more levels to go up in my game, and I feel like he's the manager to take me to those next levels. I am really excited to be working with him."

Arteta: Rice an exceptional talent

Arteta told the club's official website: "We're really happy that Declan is joining us. He is a player with tremendous ability, who has been performing at a high level in the Premier League and for England for a number of seasons now.

"Declan is bringing undoubted quality to the club and he is an exceptional talent who has the potential to be very successful here.

"Declan has great experience in the Premier League at only 24 years old. He has captained a very good West Ham team and as we all saw, he recently lifted a European trophy.

"The responsibility and role he has taken on has been very impressive and we are really excited that he is joining us."

Meanwhile, Arsenal sporting director Edu said: "Declan is a player with fantastic ability and a proven record at both club and international levels. The process of this transfer has been a big team effort with a clear plan, and we are so happy that Declan is joining us.

"Declan is a high-quality, young international player who will add great strength to our squad, fitting so well into our strategy of competing with young talented players at the centre of our club.

"It's great that Declan will be joining up with Mikel, our coaches and his new teammates in good time ahead of the new season."

Rice: Playing at 'very highest level' behind decision to move

Earlier on Saturday morning, West Ham confirmed Rice would be leaving the club but did not mention Arsenal in their statement.

It was decided between the clubs and Rice there would be no mention of Arsenal in West Ham's announcement because the 24-year-old wanted to show his respect solely to the Hammers before it was officially announced he was joining Arsenal.

The England international also wrote an open letter to West Ham fans in which he admitted his ambition to play "at the very highest level" was behind his "tough" decision to leave.

Arteta's side will play in next season's Champions League after finishing runners-up to Premier League champions Manchester City, who had a £90m offer turned down for Rice before Arsenal succeeded with their third bid for him.

"The last few days and weeks have been an absolute whirlwind of emotion," Rice said.

"I want you to know how tough a decision it has been for me to leave an environment that I have loved and cherished so much.

"This club and its supporters will always be in my heart, and forever a part of who I am.

"Ultimately, though, it has only ever been about my ambition to play at the very highest level of the game.

"Playing on the opposite team to West Ham for the first time will be an unusual experience.

"I'm not sure yet exactly how I will feel, but I also know you will all understand and respect that my professional loyalties have to now lie with my new club.

"I will always give 100 per cent every single time I pull on the shirt - because that is how I have been brought up at West Ham, and I'm sure you wouldn't expect anything else."

Sullivan: We didn't want to sell Rice

Joint-chairman David Sullivan revealed last month that West Ham had a gentleman's agreement with Rice to allow him to leave this summer after the player turned down the offer of a highly-lucrative new contract.

"I am sorry to see Declan leave us but I believe that everyone at West Ham United should be very proud of the part we have played in his journey from the Academy of Football at Chadwell Heath to becoming the most valuable young player in English football," he said in a statement.

"I would like to make it clear to our supporters that we did not want to sell Declan. We wanted to build our team around him and made a series of improved, long-term contract offers to secure his future.

"However, once Declan made it clear that he wished to move on and seek a new challenge, the club felt it would not be right to stand in his way, acting in the best interests of West Ham United."

West Ham manager David Moyes was understandably sad to see his captain depart the London Stadium.

"I'd like to personally thank Declan for everything he has done during his time at West Ham United," he said.

"Obviously it is sad when we say goodbye to someone who has been with us for so long but we must now look forward.

"As history shows, no player is ever bigger than the club.

"Our entire focus now is on building upon the success we enjoyed last season, adding to our talented Europa Conference League title-winning squad as we enter our third consecutive season in Europe, and continuing to develop the best young talent through our successful academy."

Speaking after West Ham's 6-2 win over Perth Glory on their pre-season tour, Moyes said on Sky Sports News: "Declan's gone now, he's a super player. A really good boy who performed excellently for us here at West Ham."

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What Rice adds to Arsenal and where he fits...

If Arsenal needed any further convincing over the merits of a move for Declan Rice, they got it just after the half-hour mark during their 2-2 draw with West Ham at the London Stadium in April.

Mikel Arteta's side were two goals up and seemingly cruising towards a victory which would have sent them six points clear of Manchester City. But it all changed with a moment of quick thinking from a player they have now made their record signing.

Rice, seeing Kieran Tierney about to aim a pass towards Thomas Partey deep in the Arsenal half, set off on a sprint to close the Ghanaian down, reaching him just in time to steal possession, then carrying the ball into the box and finding the onrushing Lucas Paqueta.

The subsequent penalty, won by Paqueta and scored by Said Benrahma, shifted the momentum of the game away from Arsenal. Perhaps even that of the title race too. And it started with Rice.

That passage of play showed many of the qualities that make Rice so appealing to Arsenal: the anticipation to spot the opportunity; the speed and power to get there and emerge with the ball; the composure to set up his team-mate and force the penalty.

Where does Rice's transfer fee rank?

Jude Bellingham became the most expensive English player of all time when he made the £115m move from Borussia Dortmund to Real Madrid earlier this month.

Rice becomes the second most expensive Englishman ever, costing £5m more than the £100m Manchester City paid for Jack Grealish in August 2021.

It would also be only the third time an English club has paid over £100m for a player.

Explained: How Arsenal can afford big-money summer signings

Football finance expert Kieran Maguire says that Arsenal's seemingly enhanced willingness to spend is a 'reward' for Mikel Arteta.

"Arsenal are actually in a very strong position when it comes to spending," he told Sky Sports News.

"The reason for that is they have managed to get their wages under control.

"Arsenal's wages are lower than they were in 2018. They are £150m to a £170m less than Liverpool, Manchester United and Manchester City. That has given them the flexibility to go into the market and buy new players without having to worry too much.

"Plus, they have got the additional benefits of Champions League matches coming in, premium prices and the minimum I would say prize money of £50m from being participants.

"So, you factor that all together and they've probably still got a bit of leeway in terms of what they can spend over this present window."

When asked if there's been a strategy change at Arsenal, he added: "Yes. They had a retrenchment. They went through some fallow years when they weren't qualifying for the Champions League.

"They have managed to get rid of high earners, the likes of Mesut Ozil and Pierre-Emerick Aubameyang off that payroll, and that has given them the ability to now go into the market and be very competitive and try to match other clubs.

"Arsenal used to be known as the Bank of England club. They've always been well run financially, and I think this change in terms of spending is a reward for Mikel Arteta in terms of his ability to get them into those Champions League places again, which means so much in terms of enhanced revenue."

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