Kennedy has come through the ranks at City and is a regular in club's Elite Development squad.
The 20-year-old is tipped for a big future at the Etihad but City feel he would be best served to go out on loan in a bid to gain some valuable first-team experience.
A number of clubs are thought to have enquired about taking the England Under 19 international on loan, but Leicester are poised to win the race for his services, Sky Sports understands.
Via: Kennedy set for Leicester loan
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