The Premier League side said the deal has
yet to be officially ratified, but terms have
been agreed with the 23-year-old.
"Arsenal have reached an agreement with
Granit Xhaka to join the club on a long-term
contract for an undisclosed fee," said a
statement from the North Londoners.
Xhaka, the son of Kosovo Albanian
immigrants, has represented Switzerland 41
times and helped Gladbach to a fourth place
finish this season, bringing with it Champions
League football.
Gladbach had said last week that they had
received an offer for Xhaka, who then
admitted he could see himself playing in an
Arsenal shirt.
"Granit Xhaka is an exciting young player,
already with good Champions League and
Bundesliga experience," said Arsenal
manager Arsene Wenger of his first close
season signing.
"We have been watching him for a long time
now and he is a player who will add quality
to our squad.
"We wish Granit a good Euro 2016 with
Switzerland and look forward to welcoming
him to Arsenal ahead of next season."
The transfer is still to be officially completed
but Arsenal have confirmed Xhaka's contract
will begin on July 1.
The news comes as the Premier League
revealed on Wednesday that Arsenal became
the first club to top £100 million ($147m,
132m euros) in earnings from a single
season.
Arsenal finished second behind Leicester City
meaning they earned less than the
champions in merit payments based on their
league finish.
But bitter north London rivals Tottenham
Hotspur's late-season collapse allowed them
to pinch second place and an extra £1.2
million that took their season earnings over
the £100 million mark.
The Gunners benefitted from the greatest
amount of facility fees, meaning they
featured in more live television matches than
anyone else with 27 compared to Manchester
United's 26, 25 for Manchester City, just 21
for Spurs and a meagre 15 for Leicester.
Manchester City narrowly edged out United
for second place in the earnings table with a
shade under £97 million, while Leicester were
only fifth with a little over £93 million.
