The former Nigerian U20 striker joined Union Berlin for £6.5m, a club he spent last season on loan, scoring five goals in 22 appearances for the Bundesliga side.
The 23-year-old who was granted work permit to play in the UK in May 2021, did not feature for Liverpool since joining the club in August 2015.
Since 2015, Awoniyi has been on loan at FSV Frankfurt, NEC Nijmegen, Royal Excel Mouscron, Gent, Mainz and Union Berlin, before finally leaving the Reds to join Union Berlin on a permanent deal.
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