CYPRUS CRISIS

Facing an uncertain future, residents spill into the streets.

NICOSIA • Dora Giorgali says she has to go back almost 40 years, when Cyprus was at war, to recall such a feeling of anxiety.

“I haven’t felt so uncertain about the future since I was 13 and Cyprus was invaded,” the 53-year-old unemployed nursery teacher said on a warm and bustling square in the capital, Nicosia.

“I have two children studying abroad and I tell them not to return to Cyprus,” she said. “Imagine a mother saying that.”

Hope mingled with a sense of dread on Sunday as leaders of this tiny Mediterranean island sought a last-minute reprieve from financial meltdown in talks in Brussels.

For Ms. Giorgali, these are the worst days since war with Turkey in 1974 split the island in two and displaced a quarter of the population.

In Nicosia, still a divided capital, Cypriots spilled into streets bathed in warm sunshine. The talk was of bailouts, Europe and betrayal.

“We had the impression that being part of Europe would be a good thing, that it would solve our problems,” said Chris Kikas, whose business selling hand-painted religious icons has seen better days.

“Well, it’s not like that at all,” he said. “Where is the solidarity?”

The island of 1.1 million people, for years a haven for big offshore finance, rich Russians and sun-seeking British expats, has been stunned by the pace of the unfolding drama that has left them staring at the prospect of financial meltdown.

Only a month ago they elected conservative leader Nicos Anastasiades as president on a mandate to secure a bailout that would stave off default and shore up banks crippled by their exposure to Greece, the epicentre of Europe’s stubborn debt crisis.

On S u n d a y, Mr. Anastasiades was locked in talks with Cyprus’ partners in the 17-nation eurozone, still short of the billions of euros they want before signing off on a ¤10-billion rescue package to keep the island economically afloat.

Shops, traditionally closed on Sundays, were open in the hope of attracting enough customers to kickstart the slow trade of the past few weeks.

But with bank doors closed for a week already, one mobile phone store had pinned a sign in its window that read, “Cash only — until the financial situation is resolved.”

Retailers say they are running low on stock, unable to make bank transfers or meet cash-on-delivery demands from suppliers.

“All we can do is wait and hope for the best,” said Yorgos Papapavlou, who has been unable to restock his popular textile shop because he cannot pay suppliers by bank transfer.

It’s also rare for one private-equity firm to seek to break up another’s deal. The strengths of Michael Dell’s offer include his participation and his decision to roll over his 15.6% stake to help finance the purchase.

On Monday, Dell’s board will say whether the new proposals are reasonably likely to be superior, or most likely say it needs more time to study the offers, said one of the people.

Under terms of the original Feb. 5 merger agreement with Silver Lake, the board would then take time to determine whether the counter offers are superior. At that point the bidders would have to get financing commitments to support their offer. After that, Silver Lake and Michael Dell would have three days to top them.

Blackstone and Mr. Icahn submitted their proposals on March 22, the deadline of a so-called go-shop period designed to solicit competing bids for Dell. Southeastern Asset Management Inc. and T. Rowe Price Group Inc., the company’s largest outside investors, have said the original deal is too cheap.

The stock, which closed on March 22 at US$14.14, has climbed since the leveraged buyout was announced amid speculation that Dell would fetch a higher price.

A spokesman for the Dell special committee running the go-shop process didn’t return calls or emails seeking comment. David Frink, a spokesman for Dell; Christine Anderson, a spokeswoman for New York-based Blackstone; and Mr. Icahn declined to comment. Mary Claire Delaney, a spokeswoman for Morgan Stanley, also declined to comment.

Dell isn’t planning to disclose whether it received bids until Monday, people familiar with the matter have said.

Blackstone, which is working with Francisco Partners LP and Insight Venture Partners LP, would acquire Dell’s shares offering existing shareholders to roll in their shares in a socalled public stub, with a cap on how much stock they can keep, said one of the people. Insight and Francisco Partners weren’t immediately reachable for a comment.

Blackstone, which last year hired Dave Johnson, Dell’s former head of mergers and acquisitions, was considering several options prior to the go-shop deadline, Bloomberg News reported previously. The firm had explored making a bid with privateequity firm TPG Capital, said people familiar with the matter. TPG isn’t part of the group that submitted the proposal, said one person.

Blackstone had envisioned selling Dell Financial to General Electric Co. or another bidder, the people said.