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Atletico said that the player’s lawyers and representatives from City paid the release clause to La Liga on Wednesday.
Rodri, 23, has therefore terminated his contract with Atletico, which was due to run until June 2023.
It will beat City’s previous record of £60m in signing Riyad Mahrez in 2018.
Rodri joined Atletico in May 2018 after three years at Villarreal and made 34 league appearances as they finished second in La Liga.
He made his international debut in a friendly against Germany last year and has made six senior international appearances.