The Birmingham midfielder is out of contract in the summer and Blues boss Alex McLeish says the 25-year old will be leaving St Andrews.
Alex McLeish: "We gave his advisor permission to speak to Newcastle.
"We came to a kind of impasse [over a new contract].
"I know Seb would like to stay so we'll just have to see."
The Sweden international has scored 23 goals in 154 appearances for Birmingham.