Terms of the deal were not announced but a Galaxy official confirmed the Villarreal transfer price at about $7 million. Dos Santos, 26, was reportedly seeking an annual salary close to the $6 million the team is paying former Liverpool captain Steven Gerrard, who joined the Galaxy last week.
Team officials would neither confirm nor deny that amount. Dos Santos, who is playing with the Mexican team in the CONCACAF Gold Cup, is expected to join the Galaxy at the end of the month and could make his MLS debut Aug. 9 against the Seattle Sounders at the StubHub Center.
The Galaxy has been chasing Dos Santos since 2011 and have been in negotiations with the player's agent over the current deal for weeks. Part of the delay had to do with MLS salary guidelines, which limit teams to three “designated players,” whose contracts count only partially against the league salary cap.
The Galaxy's three designated player spots are currently occupied by Gerrard, reigning league MVP Robbie Keane and U.S. national team defender Omar Gonzalez. But last week the league adopted new rules that essentially allow teams to use special “allocation money” to pay down the salary of DPs, creating a new slot to sign another player at a higher salary.
In the Galaxy's case, it used that money on Gonzalez, who earned $1 million last season. By using its $500,000 in allocation money on his contract, the Galaxy was able to fit it under the salary threshold, allowing the team to sign Dos Santos.
“There's a lot of things that have to happen for a deal of this magnitude,” Galaxy President Chris Klein said. “We've had an interest in Giovani Dos Santos. And I think he's always had an interest in us.
“It just took time for everything to come together.”
The signing of Dos Santos, a flashy attacking midfielder who has played in two World Cups, could be among the most important in club history. Not only is he a versatile and experienced player, but he will be the first Mexican national team star to join the Galaxy in the prime of his career.
And that figures to help the team make significant inroads into Southern California's large Mexican American community, in which the team has had little presence. Building an allegiance within that fan base could become increasingly important with the expansion Los Angeles FC entering the league in 2018.
But Dos Santos' biggest effect will come on the field, Galaxy Coach and General Manager Bruce Arena said.
“He has the individual flair that sometimes we lack in the final third of the field,” Arena said. “His running off the ball's good. He can go by people. He has an excellent first touch. He's a finisher. He can pass.
“He's got all those great little qualities in and around the penalty area.”
Dos Santos, who won a U-17 World Cup and an Olympic title with Mexico, made his debut with the senior national team as a teenager in 2007. Four years later, he scored one of the most memorable goals in Mexico national team history in the CONCACAF Gold Cup title game when he dribbled away from U.S. keeper Tim Howard, avoided three defenders, then looped a left-footed shot into the far corner of the net over defender Eric Lichaj.
Until joining the Galaxy, Dos Santos had spent his entire club career in Europe, playing with Barcelona, Racing Santander and Mallorca in Spain, Tottenham and Ipswich Town in England and Turkey's Galatasaray before joining Villarreal in 2013, scoring 12 goals in 58 games.
Although Dos Santos, who was born in Monterrey, has never played a club game in Mexico, he is often associated with Club America because his father, Geraldo Francisco dos Santos, a Brazilian who played under the name Zizinho, spent nine years in Mexico, including two stays with America. The elder Dos Santos, who also played two seasons with the Los Angeles Lazers of the defunct Major Indoor Soccer League, was at the Galaxy's friendly with America last Saturday, where he met with Klein.
Follow Kevin Baxter on Twitter @kbaxter11