Manchester City are to be taken over by the Abu Dhabi United Group for Development and Investment (ADUG).
The deal has been agreed between City's owner Thaksin Shinawatra and group representative Dr Sulaiman Al-Fahim, chief executive of Hydra Properties.
Dr Khalid Kadfour Al-Muhairy, the head of the Emirates Group for advocate and legal consultants has also been involved in the negotiations.
No financial details were revealed in the statement, which was released by Samir Al-Neel, media and public relations manager at Hydra Properties.
"The investment services and development in Abu Dhabi, has successfully completed the huge takeover of the English club (Manchester City), one of the most prominent and oldest English clubs," the statement read.
And a statement on City's official website read: "Manchester City can confirm that a Memorandum of Understanding has been signed between the Abu Dhabi United Group (ADUG) and Manchester City Football Club.
"A period of due diligence for all parties, including the FA Premier League has now been entered. A further statement will be released by the club in due course."
The statement added that Shinawatra will retain a role as "honorary president of the club without any administrative responsibilities".
The former Thai prime minister has been looking for new investment in the club, despite taking charge just over 12 months ago.
The statement from Hydra added that the deal was signed at Abu Dhabi Emirates Palace Hotel, and the deal was considered a "massive achievement for the Emirate of Abu Dhabi".
The statement also said that Al-Fahim had pledged to "solve all the club problems and clear any pending payments, and will comprehensively support the club by bringing the best football players in the world" to Eastlands.
Success in the Premier League, but also "European and world level" would be the aim, with "the qualification of Manchester City to the European Champions League (for) next season 2009-10" also highlighted in the statement.
Al-Fahim added: "We will adopt marketing plans that reflect positively on the club and the company."