But Pearce confirmed any loan deal cannot go through because Mills, 29, is still to recover from a shin splints injury.
"Until we get him fully fit, we can't make any decision about him. Danny is happy with that and understands the situation," said Pearce.
Mills signed a two-month loan deal with Hull City earlier in the season but was forced to end that spell after picking up the knock.
"Unfortunately, Danny is not fit at the moment," added Pearce. "He has still to get over the stress fracture of his shin."
Mills joined City in July 2004 on a free transfer from Leeds.