The Foxes are now negotiating terms with the defender in the hope of securing his signature ahead of the new season.
The two clubs have agreed upon on a fee of around £4.9million for the defender, with Leicester now negotiating with his agent to come to an agreement between the club and the player, reports TMW.
The 28-year-old would become the Foxes' third signing of the summer should a deal be pushed through, following the arrivals of Shinju Okazaki and Christian Fuchs from FSV Mainz and Schalke 04 respectively.
He would, however, be Claudio Ranieri’s first signing as Leicester boss, with the two other recruits having been brought by former manager Nigel Pearson before his sacking.
Primarily a centre back, Benalouane can also slot in at right-back, giving the Foxes another defensive option ahead of the new Premier League season.
Both Pearson and Ranieri have clearly having identified that area of the squad as being in need of improvement, with Fuchs likely to be a solid and reliable signing in that regard and Benalouane looking to add to that.
Leicester certainly struggled to keep things tight in 2014/15, with only three sides having conceded more goals than them last season, with both relegated Hull City and Burnley enjoying a better defensive record. Maybe the potential signing of Benalouane will help to improve things heading forward.