US and Russia to hold talks to end Ukraine war

Today’s agenda: OpenAI considers ways to fend off hostile bids; Deutsche’s hiring spree; Reeves seeks audit of regulators; luxury upheaval; and Germany’s lost manufacturing jobs

Good morning. We begin in Riyadh where US and Russian officials will meet today for talks about the war in Ukraine that have shocked Kyiv and its European allies, who fear Donald Trump wants to settle the conflict on Vladimir Putin’s terms.

Why does it matter: The talks in the Saudi capital are the first high-level effort to broker an end to Putin’s full-scale invasion of Ukraine since its early stages almost three years ago when negotiations fell apart amid the Russian president’s intractable demands.

What’s at stake: The US has appeared to make significant concessions to Putin before negotiations even begin — by dismissing Ukraine’s aspirations to join Nato and restore control over land currently occupied by Russia. These have alarmed officials from Ukraine and its European allies who balked at the prospect of the Russian president holding almost all the leverage.

A former Russian foreign minister has warned that those accommodations are likely to encourage Putin, who has not expressed any indication to compromise on his goal of rolling back Nato’s expansion and turning Ukraine into a failed state. Read the full report.

Here’s what else you need to know ahead of today’s meeting.

• ‘Boots on the ground’: European countries have clashed over sending troops to Ukraine with Germany, Italy, Spain and Poland expressing reluctance after the UK said it is prepared to commit forces.

• Rheinmetall warning: The chief of Germany’s largest defence contractor has said decades of under-investment in the military has left the region isolated in US-Russia negotiations.

• Ukraine’s mineral riches: Trump has the country’s vast estimated deposits of lithium, titanium and rare earths in his sights, but these have yet to be developed.

Europe faces an era-defining moment. How should policymakers and business leaders prepare? Hear from experts from the Financial Times on what lies ahead in this exclusive webinar on February 27. Save your spot here. 

Here’s what else we’re keeping tabs on today:

• Economic data: Germany and the UK issue labour market statistics, while France publishes CPI data and ZEW reports on German economic sentiment.

• High-level meetings: EU finance ministers gather for an Ecofin meeting in Brussels while the World Trade Organization’s two-day general council meeting begins in Geneva.

• Israel-Hizbollah ceasefire agreement: Israel has announced its forces will temporarily remain at five locations inside south Lebanon ahead of today’s deadline to withdraw from the country.

Five more top stories

1. OpenAI is considering granting special voting rights to its non-profit board in order to preserve the power of its directors, as the $157bn start-up fends off an unsolicited takeover bid from Elon Musk. Giving the non-profit’s board outsized voting power would ensure it retained control of the restructured company. Read the full report.

2. Exclusive: Deutsche Bank has undertaken a three-year hiring spree that has reversed almost all of the steep job cuts imposed by chief executive Christian Sewing at the start of his tenure, underlining the scale of the challenge of reducing costs. The increase in staff was concentrated in back-office roles, even as the German lender has invested billions of euros in IT to automate some of those functions.

3. Hedge funds are trying to exploit a unique clause in the bond documentation of some of Europe’s safest companies, forcing borrowers to buy back debt at above-market prices following asset sales or corporate break-ups. Here are some of the groups that have been targeted by creditors.

4. UK chancellor Rachel Reeves is to tell cabinet ministers to conduct a full audit of Britain’s 130 regulators to ensure they are working to boost growth, including looking at whether some should be scrapped.

5. Europe risks becoming “an assembly plant” for Chinese battery manufacturers unless the continent puts in place regulations that ensure technology and skills transfer in return for state aid, according to a campaign group. The warning comes as Europe scrambles to recraft its strategy to reduce its reliance on China.

News in-depth

Early this month Sabato De Sarno stepped down as Gucci’s creative director, less than two years after parent company Kering handed him the task of reviving its most prestigious brand. The Italian’s exit is the latest in a lightning series of top-level changes at big fashion houses, who are churning through talent at the fastest rate in decades.

We’re also reading . . . 

• Apple’s India pivot: The iPhone maker wants to diversify its supply chain beyond China. But can the world’s largest democracy deliver?

• Paul Weiss’s London raid: The UK expansion of the quintessential New York firm is a long-term bet on the importance of English commercial law, writes John Gapper.

• Maga SWF: Trump’s proposal for a sovereign wealth fund should be taken seriously. The potential cumulative investment returns can be huge, writes Stephen Jen, Eurizon SLJ Capital’s chief executive.

Chart of the day

Germany has lost almost a quarter of a million manufacturing jobs since the Covid-19 pandemic. Amid high energy costs, consumer malaise and competition from China, data highlights the struggle of Europe’s biggest economy and the threat of industrial decline.

Take a break from the news . . . 

Decades before social media’s fickle scroll, The Face was turning out pages that muscled their way into your psyche. Photographs from the style bible, now up at a powerfully nostalgic exhibition at the National Portrait Gallery, show how the magazine shaped popular culture.