Arsenal have completed the signing of teenage striker Theo Walcott from Southampton, in a deal which could eventually cost £12million.

Walcott cannot sign a professional contract with Gunners until his 17th birthday (March 16th), and so will join the Premiership club as a scholar until then after they paid Saints an initial fee of £5million.

Chelsea were also reported to have been chasing the teenager's signature, but the chance of regular first-team football at Highbury, and from next season the new 60,000-seater Emirates Stadium, is thought to have been key to the player's decision to choose to further his career in north London.

England youth international Walcott said: "I am so pleased to be joining Arsenal, a club I have admired for a long time. Coming to Arsenal will give me the opportunity to work with world-class players every day and play football at the highest possible level.

"It is a strange day because I am also very sad to be moving from Southampton. I am leaving many friends and some great coaches who have been so important to my career so far, but I leave with many great memories from the club. I am now really looking forward to meeting my new team-mates and working hard as an Arsenal player."

Wenger has long been an admirer of the striker, who has played in both cup competitions for the Saints this season.

"Theo Walcott is a very young player, but has already shown in his performances for Southampton that he is a talented player with huge potential," said the Arsenal manager.

"I also like the fact that he is a versatile player who is incredibly dedicated, shows great determination to succeed and is blessed with electric pace. We are delighted Theo has signed for the club and will make a fantastic addition to our squad."

Wenger feels Walcott has shown enough in his games for the Coca-Cola Championship side to suggest he can have a big impact on the top flight.

He told Arsenal TV Online: "He has pace, commitment, is very mobile and versatile - he can play on two flanks or in the centre. I feel he can adapt to the kind of game we want to play.

"At the moment, maybe he could play on the flank. I believe he is suited to three up front when on the flanks, but in the 4-4-2 then more through the centre. It depends on the system we would play in.

"First of all, though, I would say maybe the boy needs a little breather because he has played something like 23 games at the age of just 16 in Division One."

Angry Southampton chairman Rupert Lowe has called for an overhaul of the academy system as a result of Walcott's move. Lowe has labelled the move "unsatisfactory" and insisted he had no option but to let his prized asset leave.

"We are bitterly disappointed," said Lowe. "The purpose of developing the best academy in the country is not to sell scholars to larger clubs. We have done everything to keep Theo at Southampton but his family and advisors are determined that he leave this club and goes to Arsenal.

"I have no doubt that I will be blamed for this situation by a part of the fan base but if the board and I have been at fault; it has been in playing and therefore showcasing a young player who is not under a full professional contract.

"The loophole this episode has revealed needs to be remedied by the football establishment as a matter of urgency before the academy system is discredited. Perhaps England should move to a system such as that in the Czech Republic where young players can be signed as a professional at 16.

On a more positive note Lowe has pledged to hand the £5m to head coach George Burley to strengthen his Saints squad.

"As for Theo, he is a very gifted young man and I sincerely hope he fulfils his potential in the game," added Lowe. "He has been a credit to both our academy and senior side and goes with our warmest good wishes for his future. In the meantime, his legacy will be available to George Burley to judiciously strengthen our team."