After overcoming some minor sticking points in final negotiations over an initial £47.3m deal late on Wednesday night, both clubs were able to come to an agreement which involved a bigger fee.
The PA news agency understands there are no add-ons included but there is a 10 per cent sell on fee on any profit City make on the 25-year-old.
Nunes became Wolves’ record signing when he joined from Sporting Lisbon for an initial £38m last summer on a five-year contract with the option of a further 12 months.
He made 34 appearances last term, scoring one goal and proving one assist.
However, on learning of City’s interest Nunes absented himself from training in an attempt to force through a move.
In a separate deal, City’s 21-year-old midfielder Tommy Doyle is set to undergo a medical for a season-long loan at Molineux, with Wolves having a £4.2m option to buy and City retaining a 50 per cent sell-on fee on any profit made on the player.
The England Under-21 international is the grandson of Manchester City greats Mike Doyle and Glyn Pardoe and impressed on loan at Sheffield United last season, scoring four goals and providing seven assists in 38 appearances as he helped the Blades earn promotion to the Premier League.