Wolves have agreed a fee with Arsenal to sign striker Benik Afobe.
The 21-year-old Londoner has scored 19 goals in 30 games while on a season-long loan at League One side MK Dons.
"He has a good scoring record in League One and is ready to step up to Championship football," Wolves head coach Kenny Jackett told BBC WM 95.6.
Meanwhile, defender Kevin Foley, 30, has joined Danish side FC Copenhagen, who are managed by former Wolves boss Stale Solbakken.
The Republic of Ireland international, who played mostly at right-back in his time at Wolves, was the club's longest-serving outfield player.
Signed by Mick McCarthy from Luton Town in September 2007, he made 213 appearances for Wolves, but had been largely out of the first team picture following relegation to League One in 2013.
|Benik Afobe's goals for MK Dons|
|Of the 19 goals scored by Afobe while on loan at MK Dons this season, 14 of them have come at Stadium:MK|
|The most notable were his brace against Manchester United in the Capital One Cup|
He did not make a league start under Jackett, twice being loaned out to Blackpool, spending a month there last season under Paul Ince, before being invited back by Lee Clark before Christmas.
And he has now had the remaining six months of his contract cancelled at Molineux, enabling him to move to Denmark.
Wolves moved back up to eighth, within a point of the Championship play-offs, thanks to Sunday's win at Blackburn, which extended their unbeaten run to six games.
But they are struggling for goals, having scored just eight times in 12 games - and, with Bakary Sako away on Africa Cup of Nations duty with Mali, the arrival of Afobe, who missed MK Dons' 2-2 draw at Crawley on Saturday, may prove timely.
"He will help us in the second half of this season and the years to come," added Jackett. "He has the pace, power and goal-scoring record that we need.
"He has proved an asset for MK Dons. He has got over his injury problems and is on a very good run.
"I watched him come through at Arsenal and have seen his progress up to the current time. At 21, he fits into the bracket we are looking for that can improve us."