The problem that TGZ seemed to have was that the grades in...

The problem that TGZ seemed to have was that the grades in sabadola pit were declining, the strip ratio was high and the ore both fresher and getting harder making processing slower and more expensive.
They hadn't found much out in the land holding despite spending up in a big way.
The increased reserves on the ML look positive in a higher price regime but are largely marginal at prevailing price levels.
OJ V had their ML in place, I think, but the OJV management agreement with Bendon and Badr effectively gave B and B control of exploitation so that TGZ just weren't in a position to use the softer and higher grade OJV ore until conclusion of this agreement.
TGZ strong card has always been the excellent mill , power plant and water supply and the cost and delay that would occur if OJV tried to go it alone.
The beauty of this deal is that it brings together high grade supply and a modern mill and settles the huge uncertainty that has hung over the two companies...and the market likes it.
Franco Nevada conducted extensive due diligence and must have liked what was offer enough to tip in $135m and grab 6% of the output for over 40 years.
This appears to indicate that they expect significant discoveries in the future in this early stage of exploitation of the greenstone belt.
I would hope that this deal will put TGZ in an excellent position in comparison with similar size 300,000 oz producers and that we will see significant re rating of the stock as the integration and exploitation of the joint areas gets underway .