As the official offseason gets underway, the first major marker of the summer started this morning. The first buyout window is now officially open, allowing teams to utilize the strategy in preparation for the NHL Entry Draft and free agency.
Buying out a contract is a method utilized by teams to either free up additional cap space, cut ties with a player that hasn’t worked out, or grant the player and team a different opportunity heading into further seasons. For those unfamiliar with the process, a team is able to pay out the remaining money of a players contract over a period of time, allowing the player to become a free agent. The team that buys out a player will still have a remaining cap hit for a certain amount of seasons, but often it is at a reduced amount for a few years when comparing it to the original contract. The length and amount of a buyout depends on of course the contract that was signed. A more detailed explanation of the process can be found over at CapFriendly.
This year’s first buyout period could be a busy one for the NHL as a plethora of big names appear to be heading to the buyout market. Dion Phaneuf, Corey Perry, and James Reimer are only a small sample of those players that could be bought out and therefore looking for a new team.
The Flames have notoriously used the buyout strategy on a few occasions over the past few years. Brad Treliving had to cut ties with both Mason Raymond and Troy Brouwer after their free agent signings did not work out for the team. Brouwer’s buyout is one the Flames will still be feeling the effects of over the coming seasons, as they will have his $1.5M buyout cap hit for the next three years. Of course, that was a small price to pay as the Flames were able to save nearly $3M a season against the cap in 2018-19 and this coming season. It also extinguished the Brouwerplay which was well overdue.
Looking at the roster as it currently stands, there are a few candidates for which Treliving could once again use the buyout strategy. With Matthew Tkachuk’s contract about to be signed, and a few additional roster decisions to make, the team may need a bit of cap relief. Who could those players be? Let’s take a look using CapFriendly’s extremely convenient buyout tracker:
This would be a “more likely than not” situation for the Flames. After being traded for at the 2017 NHL deadline, Michael Stone was re-signed to a three year, $3.5M AAV contract right before free agency that summer. While he had a so-so 2017-18 campaign, Stone was limited to only 14 games due to a blood clot issue in the 2018-19 season.
Of course his health concerns aside, Stone did find himself on the outside looking in at the start of the season after the emergence of Juuso Valimaki. Although he played a key role at one point in time, he would probably welcome a move to a different organization to play a more elevated role. With tons of teams looking for defensemen this offseason, a trade may be the best route for Treliving. That being said, his value has gone down considerably over the past season and therefore teams may not be lining up to acquire him. A buyout of his contract would look like this:
Buying him out during the first period would allow the Flames to save just over $2.3M for one season, giving the team a bit more flexibility when looking at another goaltender and Tkachuk’s contract. The real cost would come next season, when the Flames would be hit with just over a $1.6M cap hit. With Brouwer’s buyout already there, the Flames would be paying around $3.1M in buyouts for two players. Obviously a small price to pay, but that is still enough for the Flames to sign a solid depth forward.
The Flames will probably, and should, explore a draft day trade for Stone as their first course of action. If that fails, then a buyout should take place to ensure the Flames can use their young defencemen as much as possible.
A small majority of fans are clamoring for this to happen as soon as possible, but that would be unwise. Just signed last season, James Neal still has four years remaining at $5.75M per season. What would that type of money look like in a buyout?
Oh boy. Yes, the Flames would get a ton of cap relief for the next four seasons, nearly $3.83M to be exact, but they would still be paying Neal until the end of the 2026-27 season. That is an additional four seasons, eight total. A $1.92M cap hit is manageable, but it also puts the Flames in a tough position down the road for seasons that we don’t have any idea how they will play out. That number could be costly if the Flames end up right up against the cap.
The Flames could look to trade Neal, although the options are limited, but a buyout would be a terrible option. Of course if the Flames wait one more season to see how Neal plays out, they could explore buying his contract out in 2020. Doing so would have the same cap hit at $1.92M, but would then end a year sooner. Perhaps having one more year of Neal before going down this route would be the best course of action.
Not a lot of options (aka a good thing)
There aren’t really many other options the Flames would be willing to actually buyout. Michael Frolik is most likely going to be a hot trade commodity, so why take the cap penalty? Derek Ryan’s contract isn’t perfect, but he may well have been the Flames’ best forward down the stretch last season, so why get rid of him? There is no use even mentioning the top four defenseman for obvious reasons, and the rest of the Flames forward group is solidified for seasons to come.
Treliving may have a few blemishes on his resume, but he has done an excellent job in recent memory to rid himself of bad contracts. His cap management practices have been excellent, especially with restricted free agents, so the need for a buyout is virtually non existent. Looking at other teams that need to go down this route in the coming weeks, the Flames should consider themselves fortunate they don’t need to execute a buyout this season.
Who do you think the Flames will buyout? Let us know in the comments or on Twitter @wincolumnblog
Photo from Calgary Flames Official Website