Matthew Kilgallon has emerged as a target for Leeds manager Neil Warnock, a move which would bring the Sunderland defender back to the club where he started his career.
Warnock is believed to have watched Kilgallon towards the end of the season and would find Sunderland receptive to offers – but the prospect of another bid for Mills has been dampened by Leicester City’s £3m asking price.
Leeds attempted to sign Mills on loan in February, less than a week after Warnock’s appointment as boss, and the former Reading captain is available this summer after a fall-out with Leicester manager Nigel Pearson.
Mills has three years remaining on his £25,000-a-week deal, however, and City are anxious to recoup much of the £5m fee they paid to sign him from Reading last summer.
Leicester have already rejected Celtic’s offer of a swap deal involving Kelvin Wilson and their financial demands are expected to rule Leeds out of the running.
But United, who hope a quick conclusion to ongoing talks with prospective investors will resolve a shortage of transfer funds at Elland Road, appear to see Kilgallon as a capable option having already added centre-back Jason Pearce to their defensive ranks.
The 28-year-old made almost 100 appearances for Leeds before leaving to join Warnock at Sheffield United in a £1.75m deal in January 2007.
He played only 11 times for Sunderland during the recent Premier League campaign but enjoyed an impressive resurgence under Martin O’Neill during the closing weeks of the season.
Speculation on Wearside, however, suggests O’Neill will look to move Kilgallon on this summer with his contract entering its final year.
Discussions between Leeds and an American group over substantial investment at Elland Road, meanwhile, are likely to gather pace in the coming days.
Warnock will return after a summer holiday later this week.