After weeks and months of waiting, the Yankees finally got their man. The team agreed to a seven-year contract worth $155M with right-hander Masahiro Tanaka on Wednesday morning, a deal that includes an opt-out after the fourth year. Add in the $20M release fee the team must pay the Rakuten Golden Eagles and the total investment is potentially $175M. The release fee will be paid out in installments.
Pretty much everything we know about Tanaka the pitcher is in this post. Now that he’s come to an agreement, some details about the contract itself and the Yankees’ pursuit have come to light. Here’s a roundup, courtesy of Joel Sherman, Ken Rosenthal, Buster Olney, Dan Barbarisi, Ronald Blum, Jeff Passan, Bryan Hoch, Jon Heyman, and Anthony McCarron.
The Yankees sent an eight-person crew to Los Angeles to meet with Tanaka face-to-face a few weeks ago, when he was essentially interviewing teams. Those eight people: team president Randy Levine, GM Brian Cashman, assistant GMs Jean Afterman and Billy Eppler, manager Joe Girardi, pitching coach Larry Rothschild, player development staffer Trey Hillman, and translator George Rose. Hillman just rejoined the organization and spent four years managing in Japan not too long ago. Hideki Matsui made a recruiting call at some point as well.
After listening to each team’s pitch and mulling over the offers, the two sides haggled a bit and Tanaka’s camp informed the Yankees they had to offer the seventh year to get a deal done, so they did. He may have turned down more money from another team, reportedly. I’m guessing the Cubs were the top bidder if another team did make a better offer, but that’s just a guess. The Yankees were informed Tanaka accepted their offer at 1am ET this morning, 3pm local time in Japan. I guess all the reporters were sleeping because the news didn’t break for another nine hours or so.
“I have been saying for well over a year now that it makes sense to meet [the $189 million threshold], but not at the expense of a championship-caliber team,” said Hal Steinbrenner following the signing. “I felt we needed another starter. We were not where we needed to be, in my opinion. So this should not be a surprise because [Tanaka] was the best free-agent pitcher available. He is one of the greatest players Japan has ever produced. He is tough. He has thrived under pressure. He will fit in well to New York.
“Market value is what one or more teams are willing to pay today. He is one of the best players Japan has produced and he has played well on the big stage in big games. I think he will be great for our organization and will do very, very well. But, honestly, I don’t feel that [we’d spend whatever it takes] for any player, as we showed earlier this offseason [with Robinson Cano]. That is not good for the family, our partners or the organization. There was a limit of what we were willing to do, but, yes, I felt it was important to get him.”
“We’re going to do what we’ve got to do to win. We had to make sure we had enough pitching to go together with our new lineup,” said Hank Steinbrenner following the signing. “There has been criticism of myself and my brother the last couple years that, gee, if our dad was still in charge, we’d be spending this and spending that and doing whatever it takes to win. He didn’t have revenue sharing, at least for most of his time. That’s what these people in the sports media don’t seem to get. If it wasn’t for revenue sharing, we’d have a payroll of $300M a year if we wanted to. So we’re doing this despite having to pay all that revenue sharing.”
The Yankees will not have Tanaka take a second physical. He was examined by Dr. Neal ElAttrache when he was in Los Angeles a few weeks ago as a way to facilitate the process, so the team reviewed the test results and are comfortable with them. It’s exactly what they did with Hiroki Kuroda two years ago. ElAttrache is the Dodgers’ team doctor who also consults for NFL, NBA, and NHL teams as well as PGA golfers. He’s not some quack like Dr. Nick. It’s surprising the Yankees aren’t having their doctors look at Tanaka but it’s not like they’re signing him sight unseen either.
The contract is very straight forward: Tanaka will earn $22M in each of the first six years and $23M in the seventh year. The average annual value is $22.14M for luxury tax purposes. Agent Casey Close insisted on the opt-out clause, which is the new trend in baseball. Close also secured opt-outs for Zack Greinke and Clayton Kershaw recently, plus the Yankees gave one to CC Sabathia a few years ago. A.J. Burnett opted out of his contract with the Blue Jays before signing with New York. They’re the cost of doing business these days.
Tanaka just turned 25 in November, so the four guaranteed years of his contract will cover his age 25-28 seasons. That’s really awesome, those should be his best years, at least in theory. The opt-out allows Tanaka to test free agency at age 29, when he could land another huge payday. That second contract, the one he signs at 29, will be the real scary one. We can consider this a four-year, $88M deal with a three-year, $67M player option for all intents and purposes, but there is some luxury tax calculation difference between an opt-out and a player option. It’s complicated.
The Yankees are going to have to make a 40-man roster move to accommodate Tanaka sometime before 5pm ET on Friday. He has to physically sign the contract by the deadline. David Huff seems most likely to get the roster axe but Ramon Flores is another option. The team could also work out a small trade to clear a spot. Either way, it’ll have to be done relatively soon.
These deals always contain some fun perks. In addition to the huge salary, Tanaka also receives a $35k moving allowance, a $100k annual housing allowance to be used in New York or near the team’s Spring Training complex in Tampa, and $85k to hire an interpreter of his choice. The Yankees are also giving him four first class round trip plane tickets from New York and Japan. Oh, and he gets a full no-trade clause.
In terms of total dollars, the $155M guarantee is fifth largest pitching contract in history, behind Kershaw ($215M), Justin Verlander ($180M), Felix Hernandez ($175M), and CC Sabathia ($161M). It is the ninth largest pitching contract in history in terms of average annual value, behind Kershaw ($30.7M), Verlander ($25.7M), Felix ($25M), Greinke ($24.5M), Sabathia ($24.4M), Cole Hamels and Cliff Lee (both $24M), and Johan Santana ($22.9M). It is the 18th largest contract in baseball history overall and by frickin’ far the largest ever given to an international player. The six-year, $68M deal the White Sox gave Jose Abreu earlier this winter was the previous record.
After seeing ratings and attendance (and revenue) plummet last year, the Yankees went all-out this winter to improve their team. They still have holes, yes, but they’re also much improved. Tanaka was their top pitching target all along and now he’s in pinstripes.