Tony Daley, Villa's former England winger, completed his move to Molineux for a pounds 1.25m fee. Despite the fact that Wolves' highest outlay is acknowledged to be the pounds 1.47m paid to Villa for Andy Gray, Taylor said that the club's archives showed Daley to be their record signing.
'At 26, Tony has only played one season below the highest level in 10 years in the game,' Taylor said. 'He has that ability to excite, plus an unpredictability which is a good thing for all teams to have.'
Wolves will pay Villa a further pounds 250,000 if they gain promotion to the Premiership within the next two seasons.
Taylor also revealed that Bobby Downes, Port Vale's assistant manager, will start work this morning as his No 2. Downes was youth coach at Villa under Taylor.
Although McGrath is unlikely to be teaming up with the former England manager, Taylor remains keen to sign the Port Vale midfielder, Ian Taylor, who has also held talks with Sheffield Wednesday.