Thiago has put pen to paper on a four-year deal at Anfield in a deal worth £20million up front, which could rise to £25m with add-ons.
A serial winner, Thiago has picked up league titles in Spain and Germany with Barcelona and Bayern Munich, while he has two Champions League medals to his name.
Bayern accepted he wanted a new challenge and Thiago was keen on a move to the Premier League.
According to The Athletic, a phone call in June – where he was informed that Jurgen Klopp wanted to sign him – convinced him that he should reject a £230,000-a-week deal to stay with Bayern.
Bayern were aware of Liverpool’s interest and attempted to spark a bidding war.
They reached out to Chelsea and Arsenal – both of whom had tried to sign him in the past – to see if they would be interested in entering the race for him.
Both declined, with potential suitors put off by quoted salary demands of £320,000-a-week to land him.
Barcelona also decided against making a move for the 29-year-old, deciding instead that swapping Arthur for Juventus’ Miralem Pjanic made more financial sense.
They also had the opportunity to sign him from Barcelona in 2013, but David Moyes got cold feet over a deal and instead bought Marouane Fellaini.
Moyes was reluctant to sign a player for big money that he had never seen play live and opted against the move, despite personal terms and a fee being agreed after talks with former manager Sir Alex Ferguson.