Italian car maker Fiat SpA is in talks to buy a stake in General Motors Corp.'s German-based unit Adam Opel GmbH as part of a wide-ranging strategy to become one of the world's largest auto makers, according to people familiar with the matter. Fiat Chief Executive Sergio Marchionne held talks in Berlin last week with German Economy Minister Karl-Theodor zu Guttenberg, who is leading the German government's search for a new investor in Opel, one person said.

Russian billionaire Alexander Lebedev said his Blue Wings AG airline in Germany is planning to file for bankruptcy after the discount carrier’s flight license was revoked, Bloomberg reported. “I will probably file for bankruptcy and will try to make a point that it is the German government’s fault,” Lebedev said today in an interview with Bloomberg Television.

German department store chain DWW Woolworth GmbH Co, owned by British investor Argyll Partners, has filed for insolvency, a court said on Tuesday. Slowing sales, increased competition, and insufficient liquidity are believed to have contributed to the company's collapse, Sky News reported. Business at its roughly German and Austrian stores would continue as usual, with the Austrian and logistics operations not believed to affected by the filing. Woolworth employs about 9,000 staff in Germany and generated about €900 million ($1.2 billion) in sales in its fiscal year to end-October 2008.

The ripple effects of American International Group Inc.'s woes have spread from the bastions of global finance to U.S. transit authorities to little towns throughout Germany, The Wall Street Journal reported. The reach can be chalked up in part to a kind of infrastructure tax deal that gained popularity in the 1990s and spread among hundreds of municipal and state governments around the world. Now, the deals in many cases have backfired because of the giant insurer's problems. The notion was this: Localities could earn millions of dollars selling their infrastructure to U.S.

The world could face high inflation and a “crisis after the crisis” when the global economy recovers, Peer Steinbrück, German finance minister, has warned, the Financial Times reported. The comments, in a weekend interview, are the latest sign of concern from Germany at the extra-loose monetary policies conducted by central banks around the world and the ever-larger fiscal stimuli being unveiled by governments.

Caja Madrid may be the first Spanish bank to stop interest payments to mortgage-backed bond investors as loan defaults soar, according to Standard & Poor’s. Homeowners lagged behind on repayments on 72 billion euros of mortgages as of January, Bank of Spain data show, after the credit crisis halted a real-estate boom. “A number of deals” may have to defer interest, said Dipesh Mehta, an asset-backed debt analyst at Barclays Capital in London. “Unemployment is the biggest risk” to Spanish mortgage bonds, he said.

Qimonda, the insolvent German memory-chip maker, yesterday entered formal bankruptcy proceedings as its search for an investor dragged on, the Financial Times reported. The company said 915 of just under 3,400 employees would keep their jobs as it shuttered more sites--including its main plant in Dresden. Michael Jaffé, the insolvency administrator, said he remained in talks with "potential interested parties", and with governments in Germany and Portugal about supporting any new owner.

German Chancellor Angela Merkel may be losing valuable time that General Motors Corp.’s Opel business doesn’t have as she holds out against taking a stake in the unit. Merkel says U.S. President Barack Obama’s rejection of GM’s recovery plan gives European leaders a 60-day breathing space to help save Germany-based Opel. Unions and analysts say governments need to take control of the division now or risk it falling victim to a restructuring focused on the U.S. business.

The German economy will shrink 6% to 7% this year, Commerzbank forecast on Monday, result that would put the country in the deepest recession of any major European economy this year. The German government currently forecasts that 2009 gross domestic product will fall only 2.25%. But the deluge of gloomy data from German industry is prompting more analysts to cut expectations, adding fuel to the debate over whether the country should adopt a more aggressive fiscal-stimulus policy.

Policy makers in the U.K. and Germany set out plans to place a much heavier regulatory burden on banks and other financial institutions in a sign of how rules throughout Europe are likely to change in the wake of the financial crisis, The Wall Street Journal reported. In the U.K., Lord Adair Turner, chairman of the country's financial watchdog, laid out recommendations for what he called a "profound" overhaul of banking supervision that, if adopted, will mark the end of more than a decade of light regulation in one of the world's financial centers.