The 22 year old returns to the Premier League after joining German side Leipzig from the Merseyside club in a deal worth £22.5m last summer.
"After the conversations with Scott, I got a great feeling," said Lookman. "It's the working relationship I want."
He added: "He's young and hungry and I'm young and hungry as well so it's a good match. I'm glad I can be here to help the team."