Eirik Bakke's early return to Leeds United may have freed Aston Villa m anager David O'Leary's hands to make a January transfer window loan signing.

O'Leary had previously made it clear, even before the latest window opened, that new signings were out of the question, as there was no money available and his two loan options were taken up by Bakke and James Milner.

But Leeds have refused to allow Bakke to remain at Villa Park on loan, saying that Villa would have to buy him instead. Villa, who remain in an unsettled state as a target for new owners, yesterday ruled out buying the player "for financial reasons", forcing Leeds to recall Bakke.

A club statement by Villa read "an extension to the loan beyond the end of January or a permanent deal were not viable."

Villa's stance comes follow-ing speculation that Bakke has become a target for other clubs, including local rivals West Bromwich Albion. But, assuming that a compromise cannot be reached in the next 13 days between Villa and Leeds, it does at least offer O'Leary the chance to go elsewhere to bring in a player on loan.

It will be a surprise if he does not make an official inquiry to Chelsea to explore the possibility of bringing in his No 1 autumn target Robert Huth, who remains on the first-team fringe at Stamford Bridge.

O'Leary's chief worry after Martin Laursen was ruled out for the season in September has been his lack of central defensive options, forcing him to make young Liam Ridgewell an automatic selection.

Then skipper Olof Mellberg injured his hamstring in early December, leaving Ridgewell paired with an outof-position Mark Delaney.

But the injury-plagued Delaney, who had rocked O'Leary with a transfer request based on his lack of first-team chances following the arrival of Aaron Hughes at right-back, has responded well.

When Mellberg reported fit for the 2-1 New Year win at Albion Ridgewell was left out, not Delaney. The Welsh international defender has eyed the chance to pin down a place for the rest of the season - assuming Villa do not bring someone else in on loan.

At the same time, there remains the issue of the longer-term future of a player whose contract runs out in June - and it seems dependent on Delaney's fitness.

A clause in the Welshman's contract dictates that the player and the club have until March 1 (appropriately, St David's Day) to make a decision. Given Delaney's bad luck with injuries, O'Leary appears keen to hang fire.

He said: "The club has a contract with him from well before I got here when it was agreed with his people that on the 1st of March they would be saying whether they would be taking up another year's option.

"They're doing nothing wrong. But what the club want to see is Mark get to March, prove his fitness and then see what's happening and how long they want to commit.

"Nothing's changed on the few games he's played since he's been back. Mark has come in and kept up the consistent standard the team has been showing.

"I'd have loved to have had him available to me earlier, at a time when I really needed Ridgewell out of the firing line. But he's been so unlucky with injuries. He's played only eight games this season. And that's the part of it the club want to look at."

Meanwhile, Kevin Phillips is eyeing a quick return after a Lazarus-like recovery from the ankle injury that has kept him out for two months.

Less than a week ago, O'Leary could not put a date on Phillips' likely return. Last night he scored in a 70-minute appearance for the reserves against Birmingham City at Bescot Stadium with a view to being available either for Saturday's match at Tottenham or, more likely, the FA Cup fourth-round tie with Port Vale.