Kaba shone while on loan at Cardiff City during the second half of last season and has strongly been linked with a return to the Championship.
It was suggested that Birmingham had agreed a fee to sign Kaba and were closing in on taking him back to England.
Blues though will miss out on Kaba as, according to Danish daily BT, Las Palmas have now agreed a fee for the player and he is Canary Island bound.
Las Palmas have agreed to splash out an initial €1.5m plus a further €500,000 in add-ons.
Kaba is due to travel to Spain on Friday to put the finishing touches to his move to La Liga.
The 28-year-old is into the final year of his contract at Midtjylland and it had been assumed he would be moving on.
He will now try his luck in Spain however, with a move back to England not something which will happen for Kaba this summer.
