Liverpool have signed highly rated Crewe Alexandra youngster Dan Smith for a fee in the region of £300,000, reports BBC Sport.

The 16-year-old midfielder is yet to make a senior appearance for the Alex, after joining the club's youth academy at the age of 11.

Smith had been expected to sign for Manchester City last month, but after the proposed transfer broke down, the Reds moved quickly to seal the player's signature.

The teenager follows in the footsteps of former Anfield players Danny Murphy and Rob Jones, who made the successful transition from Crewe to the Liverpool first-team.

Having attracted interest from a host of Premier League sides as he progressed through the League Two club's academy, Kenny Dalglish will be pleased to have completed the signing, which is very much regarded as one for the long-term.

Crewe are renowned for their development of promising young talent, but the Academy - run at a cost of £500,000 per year - has been facing an uncertain future, with the club posting debts upwards of £1million.

The sale of Smith will provide much needed financial relief for current chairman John Bowler, who is looking to protect the club's traditional assets.

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