The Croatian midfielder spent last season on loan to the Stamford Bridge outfit from Real Madrid, and he has now committed his future to the Blues by signing a five-year contract with the Premier League club.
He helped Chelsea FC to seal a third-placed finish in the Premier League last season and also win the Europa League under Maurizio Sarri.
The west London side are set to appoint a new manager after Sarri opted to leave Stamford Bridge to join Juventus last month.
Now, Kovacic has declared his intention to make himself one of the key members of the squad at Stamford Bridge following his permanent switch to the west London club.
Speaking in an interview with Chelsea FC’s website, Kovacic said: “I really enjoyed my season on loan with Chelsea, I feel comfortable at the club and like London and the Premier League very much. I am very happy to be able to join permanently.
“We had a successful year, winning the Europa League and I hope I can make a big contribution in the coming seasons.”
The 25-year-old made two assists but failed to score in 32 Premier League games for Chelsea FC last season.
Chelsea director Marina Granovskaia added: “Mateo proved what an accomplished player he is during his season on loan with us and we are delighted to welcome him to the club on a permanent basis.
“He already possesses extensive experience at club and international level and we are sure he will be a big success with Chelsea over the next five years.”
The Blues are currently serving a two transfer window ban from signing players, and as things stand they will not be able to make any further signings this summer.
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