The Braves seemed amenable to bringing Tim Hudson back, but were most likely looking to sign him to a one year deal in the neighborhood of $10 Million. Instead the San Francisco Giants have signed him to a 2 year deal, rumored to be worth a total of $23 Million dollars, that the Braves would have been foolish to attempt to match.
It's a very good deal for Tim, and perhaps an indication of free agency prices to come this winter, as it's expected the influx of National and local TV deal money could lead to an explosion in free agency prices. The Braves, who are fairly well stocked with young, cost controlled pitching couldn't really afford to keep Hudson, as their only real hope was that he'd take substantially less money on just a one year deal. The Braves may have somewhere between $10-15 Million to "play with" after arbitration raises kick in, and they certainly couldn't spend it all on Tim Hudson, let alone guarantee another year on top of that.
Hudson's ankle injury should be okay, and the Giants obviously felt comfortable with his health. If healthy Hudson is a good middle of the rotation arm that can give quality innings.