Luiz signed a one-year extension last week and Arsenal confirmed the news alongside the permanent signings of loan duo Mari and Soares.
Some Arsenal fans were baffled with the decision to keep hold of 32-year-old Luiz, who earned around £120,000 a week at the club.
But Telegraph claim Luiz agreed to a huge salary reduction to stay at Arsenal and his decision allowed Arsenal to push ahead with deals to secure Mari and Soares on a permanent basis.
Arsenal had been sweating over the idea of keeping Luiz after the club was hit hard by the coronavirus pandemic.
Players have already agreed to a 12.5. per cent wage cut and Arsenal have been forced to overhaul their transfer plans this summer.
Arsenal coach Mikel Arteta and technical director Edu were desperate to keep hold of Luiz due to his experience and in spite of his error-strewn first season with Arsenal.
Supporters of the club raged when details of Luiz’s contract emerged in May and the Brazilian was then sent off in Arsenal’s first game back against Manchester City.
Soares and Mari arrived in January on loan deals and the centre-back is the only one of the two to have played for Arsenal.
Mari managed just three appearances for Arsenal before picking up an injury that will see him sidelined for the next three months.
Soares will be 32 when his four-year contract expires, but Arsenal felt they had to commit to a greater financial package as the full-back arrived on a free transfer.
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