Germany

Germany's government sent a message to General Motors Co. on Wednesday: If GM sells its European car business to anyone other than Magna International Inc., then Germany might withdraw its offer of state aid, The Wall Street Journal reported. The warning comes as German politicians grow increasingly nervous about who will win the auction for GM's European operations, centered on its Opel brand, a major employer in Germany and several other European countries. Germany's strong hint could bolster Magna's chances, despite intense interest from other parties.

General Motors’ plan to sell its European operations to a Canadian auto parts maker and a Russian bank appeared Monday to be in trouble, when another bidder said it was nearing a deal for the unit, The New York Times reported. R.H.J. International, a Brussels-listed industrial holding company, said in a statement that it was in talks with G.M. for the acquisition of a majority stake in the European subsidiary, Adam Opel, which includes the operations of Vauxhall in Britain.

Paris has set aside €100 million in stimulus funds earmarked for what the French like to call their cultural patrimony, The New York Times reported. It is a French twist on how to overcome the global downturn, spending borrowed money avidly to beautify the nation even as it also races ahead of the United States in more classic Keynesian ways: fixing potholes, upgrading railroads and pursuing other “shovel ready” projects.

Arcandor AG's filing for insolvency presents an opportunity to implement restructuring moves for a better future, German Chancellor Angela Merkel said Monday, Dow Jones Newswires reported. The filing for insolvency doesn't mean the end of the troubled retail and tourism company, "but offers the chance for a reasonable restructuring," Merkel said at the Day of Germany's Industry, organized by the BDI Federation of German industries.

German Finance Minister Peer Steinbrueck said Tuesday that the German government foresees major restructuring and a wave of mergers for the country's state-owned banks, the Los Angeles Times reported on an Associated Press story. Germany has eight public sector banks, or Landesbanken, owned by regional governments such as Bavaria and Berlin that play a key role in Europe's largest economy by funding local businesses. But big bets on global financial markets and large investments in securitized debt linked to the U.S.

Italian automaker Fiat SpA is still interested in Germany's Opel despite losing a bid to take over the General Motors Corp unit, Chief Executive Sergio Marchionne said on Friday, Reuters reported. Fiat lost out last week to Canadian car parts maker Magna International Inc in a bid for Opel, but Marchionne's comments suggested Fiat might yet be a factor in the deal. "The deal technically is not closed, we will see," Marchionne said, adding that Fiat had not yet used a €1 billion ($1.42 billion) line of credit from banks.

General Motors Corp. sold more cars in Britain than anywhere else in Europe last year. But it was Germany, and not Britain, that agreed to rescue GM’s European Opel unit with bridge loans last week to ease a sale to Magna International Inc. Prime Minister Gordon Brown hasn’t committed money to a bailout, raising concern U.K. employees will be cut after the deal as more Germans are spared. Opel sold almost 350,000 vehicles in the U.K. last year under the Vauxhall brand, the No. 2 seller in the market behind Ford Motor Co.

Germany heaved a sigh of relief on Saturday over a deal with Canadian auto parts group Magna, General Motors and the U.S. government to save carmaker Opel from the imminent bankruptcy of its U.S. parent, Reuters reported. The accord sealed after six hours of talks in Chancellor Angela Merkel's offices still needs final approval but seemed set to ringfence Opel and its 50,000 workers in Europe from a GM Chapter 11 bankruptcy filing widely expected for Monday. Merkel said U.S. President Barack Obama--due to visit Germany next week--helped swing the deal with a telephone call on Friday.

Magna, the Canadian car parts maker, and Sberbank, Russia’s biggest state-controlled bank, are poised to become the new shared owners of Vauxhall, the Times Online reported. It is believed that Magna, Sberbank, which is backed by Oleg Deripaska, the Russian aluminium tycoon, and General Motors (GM), the American carmaker, have signed a memorandum of understanding in Germany broadly agreeing to undisclosed terms to carve up the ownership of Vauxhall and Opel between them.

Upping the rhetorical as well as the financial ante in what has become a high-stakes poker game that will decide the fate of Opel and the rest of General Motor’s operations in Europe, Fiat’s chief executive, Sergio Marchionne, announced that he would skip government talks Friday in Berlin to provide Opel with emergency aid if G.M. files for bankruptcy, The New York Times reported. Fiat and Mr. Marchionne are still hoping to acquire Opel, and are wary of letting their main rival in the talks, Magna, gain the upper hand.