The Arsenal academy product had said he wasn’t ready to go on another loan after a stellar season with Reims that saw him bag goals and three assists in 39 games.
Monaco announced that Folarin joins them on a permanent deal for around €30m up front with €10m worth of bonuses.
The 22-year-old USMNT forward will again play in the Ligue 1 after taking the French top flight by storm during his season-long loan at Stade de Reims.
He has signed a five-year deal with Les Monégasques and will not compete in the European club competition this season after finishing 6th last season.
Balogun was on the radar of several high-profile European outfits such as Inter Milan, West Ham United, and RC Lens after finishing joint fourth in Ligue 1’s goal-scoring charts.
Having graduated from Arsenal’s academy, the New York-born forward could only play ten games with the Gunners’ senior squad.
The Arsenal Academy youth product will now ply his trade with Adi Hütter’s side, and he’s expected to settle into the team almost immediately.
Monaco had to look for a prolific striker following the ACL injury of Switzerland international Breel Embolo and the sale of Kevin Volland to Union Berlin.
He will now partner upfront alongside Takumi Minamino and Wissam Ben Yedder.
His arrival is, therefore, expected to give Austrian manager Hütter some selection headaches, knowing the attributes of the trio.
Monaco will resume action this weekend in the week for of Ligue 1 against RC Lens, as they currently top the league on goal difference after gaining seven points out of a possible nine.
Arsenal could use the cash from this transaction to reinforce their squad with priority on a right-back.
Jurrien Timber, who recently joined from Ajax, will be out on a long term after sustaining an anterior cruciate ligament injury.