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Alex McLeish has resigned as Scotland manager and BBC Sport understands he will take over as Birmingham boss.
Birmingham have called a news conference for Wednesday morning where they are expected to unveil McLeish.
The 48-year-old led Scotland to the brink of Euro 2008 qualification and his deal ran until 2010.
But Blues, who received £3m when Steve Bruce left for Wigan, are believed to have agreed a compensation package with the Scottish Football Association.
The SFA were keen to hold on to McLeish and said it had rejected an approach for him.
But, despite the prospect of an improved deal for McLeish, the lure of the English top-flight has proved too great for the former Rangers, Hibernian and Motherwell boss.
Italy's 2006 World Cup-winning coach Marcello Lippi has turned down an offer to become Birmingham's new manager.
City wanted Lippi, 58, to succeed Steve Bruce, who has left St Andrews to take up the managerial reins at Wigan.
"We made an approach and he turned it down," Blues co-owner David Sullivan told the Birmingham Mail.
"This is not a stunt, it's genuine - he is available and we are looking at bringing in a manager of his stature and calibre, if at all possible."
Originally posted by TM:
<BLOCKQUOTE>Originally posted by James07?:
Birmingham/Villa > Rangers/Celtic
absolutely baws :thup: obviously went for money and the idea of the day-to-day job as Brum are going absolutely nowhere in the Premiership
could have waited out for a bigger job tbh, maybe Newcastle was a possibility with their fans booing Sam </BLOCKQUOTE>
They'd just start boeing him and chanting 'you dont know what you're doing' when they dont score within the first 5 seconds of his first game in charge.
McLeish quits Scotland to join Birmingham 
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