The Rubin Kazan player flew into England yesterday to finalise terms - with a view to a permanent move to St. Andrew's in the summer - before undergoing a medical today.
City were optimistic of obtaining a new work permit for the Nigerian international.Martins already has a permit but it is null and void as he left this country to join Wolfsburg from the Magpies 18 months ago.
Top Toon: Obafemi Martins could soon be playing in the Birmingham Blue
Blues boss Alex McLeish has been desperate to bring in a new striker throughout January.
He has already failed in attempts to sign Robbie Keane from Tottenham and Kenny Miller from Rangers.
Birmingham are hopeful of retaining another striker in Cameron Jerome -a target for Stoke - after the England Under-21 player made it clear hewants to stay at St. Andrew's.
Wanted Man: Zigic has been linked with a return to former side Racing Santander
But the picture is less clear regarding ?6million signing, NikolaZigic, with Racing Santander wanting to sign him on loan or in apermanent deal.
McLeish indicated last week that it would be "difficult to let Ziggygo" if he repeats the form shown in the Carling Cup semi-final win overWest Ham.
The former Scotland boss made the same point to City's acting chairman, Peter Pannu, on Saturday.
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Explore more:People: Robbie Keane, Obafemi Martins, Alex McLeish Places: Birmingham, Newcastle, Scotland, United Kingdom