After it was announced that Cliff Lee signed with the Phillies, and not the Yankees, all we heard was about the supposedly $50 million he left on the table. But now that the smoke has cleared it appears that’s not how it went down.
The Yankees were simply outbid.
The Yankees offered Lee a six-year deal worth $22 million a year plus a $16 million player option. $22M x 6 = $132M + $16M = $148M or $21M/per.
The Rangers offered Lee a six-year deal worth a total of $138 million with a lot of deferred money. Details are not 100 percent clear, but that is essentially $23M/per.
The Phillies offered Lee a five-year deal worth $120 million with an option. The $120 million includes a $12.5 million buyout so it’s technically worth $107.5 million. The option though is worth $27.5 million and if Lee is healthy should vest easily. That brings the deal to $135 million over six years. Assuming that option vests it is worth $22.5M/per. Even if the option doesn’t vest he still earns $24M/per.
Technically the Yankees offered the most guaranteed dollars and most amount of years, but because their deal was a seven-year offer it actually brings the average annual value down. Both the Phillies and the Rangers deals represented higher AAV’s.