Ratiopharm owner Ludwig Merckle has turned down offers for drugs distributor Phoenix, as he struggles to retain control over his late father's diminished business empire, sources close to the matter said Wednesday.

Creditor banks have urged Merckle to consider informal approaches for Phoenix, even before the sale of another prize asset in the Merckle empire that is on the block, its Ratiopharm generic drugs business.

But Merckle has resisted the approaches to sell Phoenix, Europe's second-largest drugs wholesale group, and instead champions the idea of taking it public, the sources said.

Although Phoenix is far from ready for an initial public offering, Merckle could at a later stage sell a stake on the stock market to pay off debt and possibly also offer new shares to fund the company's growth, two of the sources.

Buyout firm KKR, which owns Britain's Alliance Boots pharmacy chain, has recently showed renewed interest in Phoenix, extending informal offers that were viewed as attractive by Merckle's lenders, two of the sources said. KKR first expressed interest in Phoenix about a year ago.

Pharmaceutical wholesaler McKesson and pharmacy benefit manager Medco, both U.S.-based, have also expressed an interest in Phoenix, a separate source said.

All eyes are now on generic-drug maker Ratiopharm, which Ludwig Merckle has put up for sale as part of concessions his late father, Adolph Merckle, made to creditors.

Only a Ratiopharm deal value of about €3 billion, including debt, would give Merckle the financial clout to keep Phoenix completely under his control, the sources said.

The bid from Actavis, backed by its main lender Deutsche Bank, is the only one said to have reached that level, while offers from rivals Teva and Pfizer have fallen short so far.

But Actavis' campaign is seen as an uphill struggle because the Icelandic generics maker is burdened by more than €5 billion in debt, most of which was provided by Deutsche. Germany's largest bank would either have to convert some of its debt in Actavis into equity, or find a partner on short notice to provide more equity funding, several of the sources said. A spokeswoman for the Merckle family declined to comment as did spokespeople for Deutsche Bank and KKR.

A last round of binding bids is due around the end of March and Teva and Pfizer are regarded as determined contenders, eyeing a fast track into the world's second-largest generics market.

"The Merckle family is in a good starting position for talks over Phoenix after the Ratiopharm sale," one of the sources said.

Ratiopharm is vying with Stada for second place among Germany's largest generic-drug makers, trailing the Hexal generics business of Swiss drug major Novartis.

Adolf Merckle founded Ratiopharm in 1973, the first to introduce generics in Germany. The family patriarch threw himself in front of a train in January 2009 after ceding control of his business empire to lenders during the financial crisis.

His oldest son Ludwig is overseeing the breakup of the conglomerate.

A recovery in financial markets has helped Merckle raise more than €2 billion by placing a majority stake in Germany's HeidelbergCement on the stock market.

He also fetched more than €400 million from selling Ratiopharm's Swiss sister company Mepha to U.S. drugmaker Cephalon.

He is now scrambling to retain control over Phoenix, a minority stake in HeidelbergCement and smaller assets such as Kaessbohrer, a maker of snow-grooming vehicles.

Phoenix has annual sales of more than €20 billion, slightly less than German-listed rival Celesio, which has a market value of €3.9 billion.