The NY Times reported tonight that the Sun/IBM deal is off the table, at least for now. Having been through emotional drills similar to this many times, it seems as if IBM has the cards and Sun is playing a dangerous poker game.
A read of the tea leaves suggests that IBM is the only serious bidder here. Turning back the clock two weeks ago, rumors surfaced of an impending IBM bid. I don't know where the rumors came from, but do know they only benefited Sun as it was a very public invitation to parties (contacted and not) that a serious player is deeply engaged. Get into the game, or forever hold your peace. It seems that no one else stepped up to the plate.
IBM entered an exclusive negotiating period to conduct due diligence, and according to the NY Times, lowered its price from $9.55/share to $9.40/share (2%) and resisted 'guarantees' (most probably deal break-up related) suggested by Sun. As a result, Sun, a broken company, is now a spurned broken company with scant partnership alternatives.
It's a shame that such a proud franchise is headed towards such an ignoble end.