James Milner
James Milner will be in seen in Liverpool's red in the next season.Reuters

Liverpool have made their first signing of the season with James Milner joining the club on a free transfer from Manchester City.

All terms have been agreed, but the player can only move to Liverpool after the transfer window opens on 1 July, and that too subject to a successful medical.

"Liverpool Football Club are delighted to announce they have agreed a deal to sign Manchester City's James Milner, subject to a medical," the club said in a statement on their website.

"The Reds have agreed personal terms with the England international, who will join the club on a free transfer on July 1 after his contract at the Etihad Stadium has expired."

Milner agreed a deal with Liverpool, who reportedly offered considerably less money compared to Manchester City, who were willing to pay the midfielder £165,000-a-week. However, knowing first-team opportunities would come more at Liverpool, Milner decided to leave the club he joined in 2010.

Liverpool were in the market for a midfielder following the loss of Steven Gerrard, and with Milner unhappy at Manchester City, with little game time, the Reds jumped at the opportunity of signing the England international.

The player might have won a number of titles at City, but he was very rarely used in his preferred central midfield position. Hence, Milner was looking for a club, who was ready to offer him first team football and Liverpool seem to have fit the bill perfectly.

But, it was not only Liverpool , who were interested in signing the player, but also Arsenal as the player was said to have held talks with both clubs.

Though, the deal was only confirmed today, former Liverpool stars have been talking about the move in the last few days as to how Milner could fit into the team. Jamie Carragher recently said that he feels Milner will play in the central position.

"Brendan Rodgers will have spoken to him about where he sees him fitting in but he's very similar to Jordan Henderson," Carragher wrote on sports social network Kicca.

"I have no doubt one reason he's joining is to play in a more central role rather than out wide.

"Could Milner play a holding role? Maybe, but I don't think that's what suits him.

"His main strength is his engine, which could suit him and Jordan [Henderson] to both play alongside a holding midfielder (Emre Can?) but his best position is tucked in from the right in a central role which is also Jordan Henderson's so it'll be interesting how those two fit into next year's midfield setup."

After making their first signing, Liverpool are also eyeing up the services of another free agent, Danny Ings, who like Milner, has been heavily linked with Reds.