The 27-year-old full-back had begun to creep into the first team, with notable appearances for the Foxes last season, and with Nigel Pearson's squad thin in defence, the release of a fringe defender will not please the City faithful.
Nonetheless, Kennedy made just six appearances in over two years at Leicester, spending much of his time on loan, firstly at Rochdale and latterly at Peterborough. Both clubs are thought to be interested in securing the defender's signature.
Neither the club nor Kennedy have yet commented on the player's departure.
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