Dindane has spent the season on loan with Portsmouth from Lens and will bid farewell to the Fratton Park club following Saturday's FA Cup final with Chelsea.
With Pompey unable to push through a permanent deal due to their crippling debts and relegation to the Championship, the 29-year-old has attracted several suitors.
Wolves manager Mick McCarthy and Blackburn counterpart Sam Allardyce were both reported to have tabled bids, but they faced competition from Panathinaikos.
And it appears that the Greek club, who can offer the lure of Champions League football, have won the race for the forward's services.
Dindane said: "It is obvious I will choose Champions League football with Panathinaikos."