“The board and me and my staff decided a long time ago to activate that option. It is done the decision”
Nordtveit is also joining on a free transfer from German club Borussia Moenchengladbach for next season.
Bilic refused to confirm his arrival but it’s believed the ex-Arsenal midfielder, 25, has agreed a pre-contract agreement to join the east Londoners.
The West Ham boss added: “I can only say that of course we are monitoring the player – he is a really good player.
“He is out of contract. Many clubs are interested in him – almost all of the Bundesliga want him to stay there because he is a great professional, great player and he is the captain of Borussia Monchengladbach.
“It is not only Bundesliga clubs but many clubs in England we have heard want him as well. We are also interested in him.”
Champions League chasing West Ham head to champions Chelsea in the unlikely position of being favourites.