Michael Jackson will take over the O2 arena in London for two months this summer after signing a deal worth more than £100 million, the Evening Standard can reveal.

The 50-year-old singer, who will formally announce the concerts at the venue tomorrow, will earn the extraordinary amount for the residency scheduled for June and July.

The deal, which a source said could go "up to 50 nights", was hammered out this week following months of negotiations between the singer's representatives and AEG, operators of the 20,000 seat-venue. Jackson was in London to sign the deal.

Promoter Harvey Goldsmith also played a key role. They will be the only concerts Jackson performs in the world this year with tickets from £75 upwards and will be his first major performances since he was acquitted on child abuse charges in 2005.

This is the longest run of shows by any one act since the venue at the former Millennium Dome opened two years ago.

It is the type of deal which until now had only been seen in Las Vegas, where both Elton John and Celine Dion have had long-running residencies which were established by Frank Sinatra.

A source close to the deal told the Standard that negotiations have involved a series of "creative commercial opportunities" connected to the residency, which could include a new album being given away free to fans, a share in merchandise sales and an official DVD of the shows.

Jackson is said to be putting the finishing touches to his first new album since 2001, and has collaborated with songwriters Kanye West, Will.I.Am and Ne-Yo.

The source continued: "Michael Jackson will not be playing anywhere else in the world so there will be huge demand for tickets.

"The exact number of dates are not finalised yet but could go up to 50. He will have no problem selling out that many shows."

AEG are thought to have received reassurances about Jackson's health after he was photographed in Las Vegas, just before his 50th birthday last August, dressed in pyjama trousers and looking gaunt.

The source added: "Performing live is what Michael Jackson does best and he is a professional entertainer. He wouldn't be going in to this if he wasn't feeling 100 per cent up to it."

The singer is reportedly more than £100 million in debt and is clearing out his Neverland ranch for an auction next month.

More than 2000 items - including the property's gates - will go under the hammer during the five-day sale in Beverly Hills.

Also for sale are the sequinned glove Jackson wore in the Billie Jean video, a customised Harley Davidson and a Rolls-Royce.

In 2007, Prince performed 21 sell-out shows at the O2 and gave away his new album free to fans.

The Outside Organisation, the agency which represents Jackson, declined to comment. AEG also would not comment.

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