Leafs fans rejoiced yesterday as William Nylander signed a 6-year extension, but the structure of the contract suggests that Nylander may have sealed his fate to be traded.
The Toronto Maple Leafs reportedly got this contract signed within minutes of the 5 PM EST deadline that, if passed, would have forced Nylander to sit out the year.
The details of the contract are as follows: Nylander will receive $41.77M over 6 years, an average annual value of $6.96M. This year’s cap hit will be prorated to $10.27M, but the following five seasons of the contract will hold a cap hit of $6.96M/year.
The contract is larger than comparables of the past such as David Pastrnak, Nikolaj Ehlers and Johnny Gaudreau, though part of that can be attributed to contract inflation resulting from a rising salary cap.
Regardless, Nylander’s $6.96M cap hit will make it difficult to sign the collection of Toronto Maple Leafs players that are due for extensions at the end of this year, including Auston Matthews, Mitch Marner, Kasperi Kapanen, and Jake Gardiner.
Reactions in the hockey world have been mixed. Some have suggested that Kyle Dubas caved on his demands, while others believe that the Leafs made the right choice and needed to make sure that Nylander would be present for this year’s potential Stanley Cup run.
Reading Between the Lines
What many have failed to notice is that the structure of the contract tells a larger story. On July 1, 2019 Nylander will receive an $8.3M signing bonus. After this signing bonus is paid, he will be owed $24.7M over the next 5 seasons. Therefore, while his cap hit will remain at $6.96M, he will only be owed $4.94M/year in real dollars over the rest of his contract.
This outstanding value will serve as a major asset in trade negotiations with teams such as the Carolina Hurricanes who rarely spend anywhere near the cap and would remain undeterred by Nylander’s cap hit of $6.96M. The Leafs would certainly be in a position to garner higher value for Nylander because he is an extremely cost-effective player that provides greater value than his remaining $4.94M/year salary suggests.
The relationship is a natural one, as lower budget teams are concerned with the payments they make to players, whereas higher budget teams like the Leafs are principally concerned with a player’s cap hit. Additionally, the Hurricanes are a natural trade partner with an abundance of defensive talent to trade and a need for scoring.
It also appears based on Dubas’ comments that the end solution of the negotiation process was a difficult compromise:
"“Not [making history] in the way we’d like to […] They were entrenched in their spot and we were entrenched in ours.” – TSN"
It is highly likely that the deal Nylander signed was put in place some time ago as a failsafe if the two parties were unable to agree on a more satisfactory deal to keep Nylander as a long-term Leaf. Marc Savard’s tweet from November 23rd suggests that this deal could have been on the table for at least a week.
I’m hearing that 6.9 mill a year gets @wmnylander in a @MapleLeafs uniform before December 1st deadline !! My insider will remain anonymous!! Goodnight Ladies & Gents...
— Marc Savard (@MSavvy91) November 23, 2018
With that being said, the Toronto Maple Leafs have left themselves the flexibility to keep Nylander if he plays very well. For instance, if Nylander takes significant developmental strides this year and scores a point per game or higher, the team could opt to keep him because he significantly outperforms his contract.
However, if Nylander s regresses, the Toronto Maple Leafs are likely to flip him for a high yield of assets and use the $6.96M in cap space to re-sign Jake Gardiner and others.
In this way, it appears that Nylander has been given the option to play his way onto next year’s roster or face being traded. It is an interesting way for a player to bet on himself, but this innovative approach should come as no surprise from trailblazer Kyle Dubas.
With a sense of uncertainty about Nylander’s future, one thing remains certain: The Toronto Maple Leafs are stronger today than they were yesterday and that is something that all Leafs fans can be happy about.
Contract values collected from capfriendly.com