BERLIN, Aug 15 (Reuters) - Struggling German airline Air Berlin filed for insolvency on Tuesday after years of losses caught up with it and shareholder Etihad withdrew funding, with rival Lufthansa saying it was in talks to take over parts of its business.
Air Berlin, whose debt piled up after a series of takeovers, has seen speculation over its finances hit bookings. Funding from Etihad, which bought into the airline in 2011, has helped to keep it afloat in recent years, but the Abu Dhabi-based airline has been reviewing its European investments after they failed to bring it the profit it expected.
Etihad last provided additional funding of 250 million euros ($293 million) to Air Berlin in April.
"However, Air Berlin's business has deteriorated at an unprecedented pace, preventing it from overcoming its significant challenges and from implementing alternative strategic solutions," Etihad said in a statement.
Air Berlin said its flights were continuing. The German government said it had provided a bridge loan of 150 million euros.
Shares in Air Berlin were suspended from trade until 1205 GMT. Lufthansa's stock extended gains to trade 2.2 percent higher at 20.09 euros by 1140 GMT.
($1 = 0.8520 euros)
(Reporting by Victoria Bryan; Editing by Maria Sheahan) ((email@example.com; +49 30 2888 5169; Reuters Messaging: firstname.lastname@example.org Twitter:@vl_bryan))