Blues manager Steve Bruce is continuing with his transfer plans amid the news of an imminent takeover at St Andrews.
Kapo, a France international, is holding talks with Blues after the two clubs agreed a fee.
City are also close to confirming Scotland striker O'Connor's £2.6million move from Lokomotiv Moscow.
With the deal set to be rubber-stamped, O'Connor spoke of his delight at the chance to impress in the Premier League.
"I'm delighted to be back in Britain, for my family, to be back and happy and enjoying my football again," he told Sky Sports News.
"It's a fantastic opportunity to play against the best players in the world. I'm going to take that with both hands now.
"I'm sure I can give a lot to Birmingham, I'm ready to listen to what the coaches have got to say and I hope I can work my way into the team and show I'm a good player.
"I'm looking forward to working with Steve Bruce and Eric Black, I'm sure they can bring things to my game.
"It's the right time for me to move back and to be moving back to the best league in the world."
He added: "It's the best move possible. My wife is buzzing. I'm just looking forward to us being a family again. I've missed my son growing up and want to enjoy the family."
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