By North-west correspondent Alex Stevens

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Jerome Sinclair has joined Watford from Liverpool after the clubs reached an agreement on the compensation fee, it was confirmed on Thursday morning.

The Hornets have prised the striker from Anfield after failing to tempt the Merseysiders into selling the teenage forward in the January window.

Liverpool announced on their official website that Sinclair will formally join Watford on 1 July after the expiry of his Anfield contract.

It is understood that Sinclair has penned a three-year Watford contract with the option of a fourth year.

Liverpool had placed a £2million valuation on the striker in January but, even though he is out of contract, the club have agreed a compensation fee under FA rules as the player is under the age of 24.

“Following amicable and professional discussions between Watford and Liverpool, the clubs have reached an agreement regarding a transfer,” read a statement on the Merseysiders’ official website. “Liverpool would like to wish Jerome all the best in his new career with Watford.”

Sinclair, who moved to Anfield as a 15-year-old from West Brom in 2011, has decided to move after failing to to break into the first team under Jurgen Klopp and his predecessor Brendan Rodgers, and has made only one start for the Reds.

In total, Sinclair has made five appearances for the first team and scored just the one goal, in the FA Cup third-round 2-2 draw against Exeter in January.

Football Insider revealed in March that Sinclair was in advanced talks to join Watford after being offered a contract by the club.

In other Liverpool transfer news, the club have booked a medical but Napoli are ready to hijack the deal.