Andy Carroll is on the brink of joining West Ham permanently after passing a medical with the Premier League club.
Brighton have threatened to take action against the LMA as the dispute with Gus Poyet rumbles on.
The Serie A side announced the move on their official website on Wednesday night, with Rovers doing likewise once the deal was ratified.
The Argentinian midfielder, who is under contract at Ewood Park until summer 2014, will remain with Palermo until June 30.
Formica, 24, joined Blackburn from Newell's Old Boys two years ago and has scored five times in 54 appearances.