"We are edging closer to an agreement with Steve and his club," Gradi told Crewe's official website.
"I have spoken to (Rovers director of football) Lennie (Lawrence) and he is happy with the loan extension, but that doesn't necessarily mean that his board of directors will be happy with it.
"We will have to wait and see on that one but I think we are heading towards a solution. Steve wants to come here and we want to sign him so that is a good basis on which to move forward.
"We will look to sign him on loan until the end of the season with a guarantee to sign him permanently in the summer once his contract at Bristol Rovers has expired."