Here's today's look at some of the top stories on markets and politics in Europe:

Bavaria election results are good for Merkel, bad for coalition.

The Christian Social Union, sister party to German Chancellor Angela Merkel's Christian Democratic Union, swept the Bavarian state elections, garnering 49 percent of the vote. The result is a strong sign that Merkel will win the German federal election in a week's time. Yet the Free Democratic Party, the junior partner in the current ruling coalition, collected just 3 percent of the vote and failed to get into the Bavarian parliament. That bodes ill for the FDP on the national level. Merkel may have to find a new coalition partner -- most likely her party's bitter rivals in the upcoming election, the center-left Social Democrats. For the popular chancellor, that will mean a difficult four years in power: Peer Steinbrueck, the Social Democrats' candidate for Merkel's job, criticized her harshly during the campaign and disagrees with her on major economic policy issues. He did, however, serve as finance minister in Merkel's first cabinet, and the two should be able to get along if they must.

Fiat chief resorts to Chrysler IPO to allow U.S. shareholder to exit.

Fiat chief executive Sergio Marchionne told the Financial Times that the necessary paperwork for an initial public offering by Fiat's U.S. subsidiary, Chrysler, will be filed this week. The move delays a full merger between Fiat and Chrysler, which Marchionne needs to strengthen the company's competitive position, but allows a United Auto Workers health care trust to sell its 41.5 percent stake in Chrysler. The two Chrysler shareholders could not agree on a valuation of the company: Fiat valued it at about $4.2 billion while the trust's estimate was $10.3 billion. So, a direct sale could not be arranged and Fiat is grudgingly going through with a listing. The squabbling over Chrysler, which Fiat saved from bankruptcy in 2009 and which is now helping the company to offset losses in the European market, is holding the Italian carmaker back from being a more aggressive global player. At the Frankfurt Motor Show this month, Fiat did not exhibit a single new model. If it comes to a Chrysler IPO, the health care trust may well receive less for its stake than Marchionne originally offered.

New Air France CEO calls for additional cuts.

Newly appointed Air France chief executive Frederic Gagey is expected to unveil a new cost-cutting program for the airline on Sept. 18. According to the French business newspaper Les Echos, the plan includes a voluntary redundancy plan that will eliminate some 2,600 jobs, and a proposal to phase out Boeing 747 planes by 2016 because they are too expensive to fly. The company also needs to cut its ground service costs, which are 47 percent higher than EasyJet's at the same French airports. The goal is to save an additional $531 million by the end of 2014. Previous restructuring measures have fallen short: although earlier cuts helped the company beat analyst expectations in the second quarter, when it posted an operating loss of $82 million, less than half than a year ago, they haven't stopped the company from losing share to low-cost airlines on European and domestic routes. Still, Gagey will have a tough time convincing the French Socialist government, which holds 15 percent of Air France, to approve more job cuts.

Lufthansa chief moves to Roche.

In one of the "deals of the year" on the European job market, Christoph Franz, chief executive of the German airline Lufthansa, is moving to the Swiss pharma company Roche as chairman of the board. It is a blow to the airline, where Franz led a successful restructuring effort, strengthening the low-cost affiliate Germanwings and cutting costs. The measures, however, have been unpopular, and Lufthansa has been plagued by troubles with labor unions, resulting in frequent strikes. The new, non-executive job will allow Franz to work in a more peaceful environment: Roche is a stable business that does not require an overhaul.

Kerimov to sell Uralkali stake.

Several groups of investors close to Russian President Vladimir Putin are reportedly interested in billionaire Suleiman Kerimov's stake in Uralkali, one of the world's biggest potash producers. Uralkali recently unleashed a global potash price war by breaking up its cartel with Belaruskali, a producer based in neighboring Belarus. On a recent visit to Belarus, Uralkali chief executive Vladislav Baumgertner was arrested for "abuse of powers." Despite Russia's demands that he be released, he remains in jail, and Belarussian authorities have said they are prepared to charge Kerimov, too. The billionaire is now seeking a buyer for his 21 percent stake, hoping for a 25 percent premium over the market price. Interested parties reportedly include Igor Sechin, head of the state oil company Rosneft, and Putin friends Vladimir Kogan and Arkady Rotenberg. Their interest may explain the fact that Russia has not put more pressure on Belarus to release Baumgertner. If Rosneft or businessmen close to Putin acquire Kerimov's stake, it is likely that the potash cartel will be revived and global producers will no longer have to worry about a price drop.

(Leonid Bershidsky, an editor and novelist, is a Bloomberg View contributor. He can be reached at bershidsky@gmail.com.)