Real Madrid forward Michael Owen will be unveiled as a Newcastle player at 1200 BST on Wednesday.
The England striker, who passed his medical on Tuesday, has agreed a four-year deal and is believed to have cost the Magpies a club record £17m.
Newcastle chairman Freddy Shepherd said: "Bringing Michael here will rank alongside the signing of Alan Shearer as my proudest moment at Newcastle."
Liverpool had wanted to re-sign Owen but baulked at Real's asking price.
Owen revealed Everton boss David Moyes rang him on Monday evening to ask if he would consider a move to Goodison Park.
He told The Times: "Just before I arrived home, David Moyes rang to see if there was a chance of getting me to Goodison Park and to wish me luck if not.
"I think he must have known that my Dad was briefly an Everton player and I used to follow them as a boy."
Once Owen completes his move to Newcastle, his arrival at St James' Park will eclipse the money the club spent in signing Alan Shearer for £15m from Blackburn in July 1996.
Alan Shearer and Michael Owen started together for England 13 times
England won four, drew four and lost five of those games
The pair combined for nine goals in those games (Shearer five, Owen four)
The details of his contract with the Magpies are not known but reports suggest there may be various get-out clauses depending on the team's performance.
"It will be a great achievement if we sign Michael," Newcastle manager Graeme Souness told the club's official website.
"In football, the hardest thing to get is someone who puts the ball in the back of the net and Michael is the best at doing that for England.
"I'd say it's the biggest transfer I've been involved in as a manager of any football club."
England coach Sven-Goran Eriksson believes it is a major boost knowing Owen will play regular football before next year's World Cup.
"It is a great club. He will play regular football, much more than last season. I suppose he is very happy," said the Swede.
"He will score goals for them and it is great to play with Alan Shearer. He is a good targetman and will give Michael Owen many chances, I am sure of that."
Owen was left out of Madrid's squad for the first game of their season after falling behind Ronaldo, Raul, Julio Baptista and Robinho in the pecking order at the Bernabeu.
"The transfer is official," said Real Madrid director of football Arrigo Sacchi.
"He is already a player for the English club. Real Madrid have been happy with him and we thank him for all that he has done here. We wish the best for the future.
"He asked to leave because we are in World Cup year and here he was not going to play regularly. We didn't want to let him go and only when a decent offer arrived did we consider selling. We wish him luck and hope all goes well.
"It's clear we have lost something but you can't keep a player when he wants to go. He is one of the best strikers in the world but here we have Robinho, Guti, Raul, Ronaldo and he wasn't going to play much."
Owen travelled to England and met Liverpool boss Rafael Benitez for two-and-a-half hours on Monday before going to Northumberland.
There he met Newcastle chairman Freddy Shepherd and his son, manager Graeme Souness, captain Alan Shearer and coach Dean Saunders.
Owen had said he would only play for the Magpies on a one-year loan deal but he has been convinced to sign permanently in a coup for the club.
The player is England's fourth all-time highest goalscorer with 32 goals and, even though he is suspended for the World Cup qualifier against Wales on Saturday, he should return to play Northern Ireland on 7 September.
Owen will bring a proven goalscoring pedigree to a team who have yet to score a Premiership goal so far this season.
He was named European Footballer of the Year in December 2001 and, after 158 goals in 297 games for Liverpool, left for Real Madrid where he scored 16 goals as a bit part player.