Birmingham boss Alex McLeish has been told Ryan Babel will consider a move to St Andrews if a fee can be agreed with Liverpool.
McLeish is understood to have had a £9million offer rejected by the Reds for the 23-year-old striker who finds himself on the periphery at Anfield.
The Holland international has started just three Barclays Premier League games this season as he has primarily been used as a substitute.
Although Liverpool boss Rafael Benitez is eager to raise funds for his own transfer targets this month, the Blues will need to make bid a figure closer to the £11.5million paid to Ajax for Babel in 2007.
Speaking to Dutch newspaper De Telegraaf, Babel's agent Winnie Haatrecht said: "We know that Liverpool are seriously thinking about the offer from Birmingham.
"We would consider a deal if both clubs come to an agreement. "In general Ryan wants to succeed at Liverpool, but if the people at Anfield conclude it's better he leaves, we have to think about the next chapter in his career.
"We will look then to the team, the perspectives of the club and Ryan, as well as a meeting with the manager."
With new owner Carson Yeung apparently providing a transfer budget of £40million, City boss Alex McLeish is naturally being linked with a welter of players.
McLeish is also believed to have failed with a £10million offer for Celtic winger Aiden McGeady, whilst he is rumoured to be poised to return to former club Rangers to prise away striker Kris Boyd.
The Scot, meanwhile, is moving ever closer to landing long-term target Michel from Sporting Gijon.
Sporting have authorised the £3million transfer for the midfielder as they are desperate for the funds.
Sporting president Manuel Vega Arango said: "We have convinced the technical staff this (the deal) is for the best, because we have to improve the financial situation at the club.
"I understand (coach) Manuel Preciado was keen to limit the damage to the squad, but this is what we have to do."
