Former Moto2 champion Espargaro, 24, will therefore rejoin his current teammate, Bradley Smith, as KTM effectively takes on the 2016 Tech 3 Yamaha line-up next year.

KTM signed Smith on a two-year deal in March.

Espargaro’s deal should be officially announced before the Barcelona MotoGP round on June 5, which means he will be Smith’s teammate for at least a third successive season.

He had also been approached by Ducati satellite team Avintia with the lure of a 2017-spec Ducati, but instead seems set to take the factory route with the incoming Austrian brand.