Birmingham have had a £3million bid for Marlon Harewood rejected by West Ham, who want nearer to £5million for the sought-after striker.
Blues made an offer of an initial £2million plus add-ons for Harewood, who is surplus to requirements at Upton Park and is also being chased by Fulham, Portsmouth and Wigan.
But the Hammers are believed to be looking for something near £5million for the former Ipswich and Nottingham Forest player.
That is unrealistic from the point of view of Blues, who are also interested in West Ham defender Paul Konchesky.
Harewood played a major role in the Hammers regaining their Premier League status two years ago when he scored 16 goals.
But he has gradually slipped down the pecking order and last season netted only four goals.
Blues boss Steve Bruce has been given the green light to continue with his transfer plans despite the current uncertainty surrounding the future of the club.
He has already signed Middlesbrough defender Stuart Parnaby and agreed a permanent deal for Arsenal midfielder Fabrice Muamba, who spent last season on loan at St Andrews.
Hong Kong businessman Carson Yeung is expected to step up his bid to buy Birmingham during the next few days.
The billionaire, who was unsuccessful in his attempt to take control of Reading, has already had his representatives visit St Andrews and inspect the club's finances.
