Saint-Etienne's statement did not give a transfer fee, but said it was the biggest the club had ever received for a player and that it was compelled to accept the "exceptional" offer due to the financial impact of the COVID-19 pandemic.
Sources told ESPN the fee was €35 million plus a potential €5m in add ons, with the bid marking the third time Leicester had approached Saint-Etienne for the 19-year-old Fofana.
France Under-19 international Fofana has already agreed personal terms with the Foxes, according to sources, and will undergo his medical before signing a contract. Fofana pushed for a move and was really keen to joined the former Premier League champions.
Fofana broke into the Saint-Etienne first team from the academy in May 2019 and made 17 Ligue 1 starts for the club, also helping them reach last season's Coupe de France final where they lost 1-0 to Paris Saint-Germain.
Some information from Reuters was used in this story.