Modric move to Milan confirmed by new coach Allegri
The move means the 39-year-old midfielder, who announced in May that he would be leaving Madrid after the Club World Cup, will bring his 13-year spell at the Spanish giants to a close.
"Modric will arrive in August. He is an extraordinary player," Allegri told reporters in his first press conference as Milan manager.
Real face Paris St Germain in the Club World cup semi-finals on Wednesday, with the final scheduled for Sunday.
Modric, the 2018 Ballon d'Or winner, will join a Milan side looking to bounce back from a disappointing campaign that saw them finish eighth and miss out on European competition.
"To the fans, I say the most important thing is to work well every day," Allegri said. "The only way to regain respect is through responsibility and by achieving results. We will absolutely need their support."
The Italian, who has joined Milan for a second time after replacing the sacked Sergio Conceicao at the end of May, also outlined some key changes to the squad ahead of the new season.
Netherlands midfielder Tijjani Reijnders was sold to Manchester City in June while France left back Theo Hernandez could be on his way to Saudi Pro League side Al-Hilal.
"While Reijnders and Hernandez won't be part of the team next season, (goalkeeper) Mike Maignan and (forward) Rafael Leao seem willing to stay," Allegri said.
Milan will kick off their Serie A campaign on August 23 with a home fixture against Cremonese.
Allegri, who previously guided Milan to a Serie A title in the 2010-11 season, last managed Juventus.
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