“Of course we are disappointed to be losing a player of his quality, but that is the nature of football and Leicester matched our valuation for Lee.

“This move gives Lee the chance to progress his career. I’m sure he will be a great success there and I would like to wish him well.

“And as one player departs, it creates opportunities for others to shine.”

Town chief executive Nigel Clibbens said: “Under the chairmanship of Dean Hoyle, the club’s approach has been to develop our own young players through the academy and also to recruit young players with the potential to improve our squad and play at a higher level.

“This naturally means that some players will be sold from time to time.

“Too often in the past the club has been a forced seller and failed to get the best deal.

“The important factors are firstly that these moves come at a time of the club’s choosing and for the maximum possible value, and then that the squad improves from year to year by recruiting the best players we can.”

Leicester will officially unveil Peltier as their first close-season signing at a Walkers Stadium news conference today.

Meanwhile MK Dons have signed Yeovil’s former Ipswich striker Dean Bowditch on a two-year deal.