The Chinese Super League club reported on Monday morning that Anelka would sign a two-year contract next month after recently having a transfer request accepted by the Blues.
And Chelsea have confirmed they have agreed a deal for the French striker's permanent transfer when the transfer window opens.
Anelka is in the final year of his Stamford Bridge contract and it became clear earlier this season that his three-year stay with the Blues would not be extended. He and team-mate Alex were banished from Andre Villas-Boas' first-team squad after handing in transfer requests, although both had enjoyed only very limited action under the new manager.
Anelka could link up at Shenhua with fellow Frenchman Jean Tigana, who is being earmarked to take charge of the club.
Former Arsenal, Real Madrid, Manchester City and France star Anelka has already been welcomed by his prospective new team-mates, with captain Yu Tao writing on Weibo, the Chinese equivalent of Twitter: "It's impossible not to be excited by this - a warm welcome to our new team-mate!"
Goalkeeper Wang Dalei added: "Tell Anelka he made his new team-mates really proud!"
A host of rival clubs were linked with Anelka, including West Ham and Major League Soccer side Montreal Impact, but moving to China will make him arguably the biggest signing in the country's history.
He may not be for long if Shenhua or Super League rivals Dalian Aerbin succeed in their pursuit of Chelsea team-mate Didier Drogba.
Source: PA
Source: PA