The Kenyan international ran down his contract with Gor Mahia and he was unable to agree on a new deal with the club.
Azam FC is reported to have forked out between $30,000 and $40,000 to lure Muguna to Chamazi on a two-year deal that is set to be officially announced soon.
It is also being reported that Muguna will be earning more than $5000 per month, which will make him one of the highest earners at the Azam FC.
The club took to social media to announce the arrival of Muguna, who has joined Zambians, Charles Zulu and Rodgers Kola, and Tanzanian left fullback, Edward Manyama, as the new arrivals at Chamazi.
Azam FC disclosed in a statement: “Azam FC is pleased to announce that we have signed Kenyan international striker Kenneth Muguna on a two-year deal from Gor Mahia.''
''Muguna is coming to strengthen our squad in the attacking zone, in a deal that will keep him serving Azam FC until 2023.”
On Tuesday, Muguna wrote an emotional farewell to Gor Mahia fans on social media, in which he thanked the club’s management, fans, and fellow players for extending their support to him during his second stint.
Muguna noted: “When I arrived at this great club I was just a young man with dreams of representing the biggest Club in the country, I didn't expect things to go as well as they did but you made it a lot easier for me and not to forget the high level of players with so much quality who were always there to support and make me feel comfortable.”
“Looking at what I have achieved at the club is so satisfying, I was lucky enough to play under great coaches and great management as well.''
''Thanks to the chairman and the whole management for the effort they showed in renewing my contract which didn't materialize because I felt I needed a new challenge. Thanks for the years we spent together and I hope that we enjoy the remaining matches.''
The midfielder signed for the record Kenya Premier League champions, Gor Mahia, in 2017 from Western Stima after he was voted the country's Premier League's Most Valuable Player in 2016.
He left Gor Mahia for a stint in Albania with FK Tirana in 2018 before returning in 2019.
He led Gor Mahia to the CAF Confederation Cup quarterfinals and also won three league titles.
This season he won the Kenyan Federation Cup and was voted Most Valuable Player of the tournament.
In May, the Confederation of African Football, CAF, discipline board found Muguna guilty of attacking a match official and slapped him a USD 16,000 fine and a further four-match ban from any of the CAF inter-club competitions.