White Sox Re-Sign Jake Peavy for 2/$29M

Faced with a $22 million team option for 2013 or paying Jake Peavy a $4 million buyout and letting him hit free agency, the White Sox went with Door #3; re-sign him to an extension that lowers his annual payout but keeps him in Chicago through 2014 and gives them a team option for 2015.

The new deal is worth $29 million guaranteed, with a few million of that likely being a buyout of the 2015 option, so Peavy’s salary each year is probably going to be $13 or $14 million. Given his performance history, that’s a bargain if he stays healthy. Of course, with Peavy, that’s a bigger if than with most.

From 2008 to 2011, Peavy threw just 494 innings, or just 30 more than Rich Harden. He missed essentially half of each season from 2009 to 2011 with elbow pain, an ankle strain, and then finally a serious shoulder problem that required “experimental” surgery — really, it was more of an experiment in regards to baseball players, as it had been performed on other athletes before — in the summer of 2010 and shelved him for essentially a full year. Without the surgery, it’s possible his career would have been over, so he underwent what is now sometimes jokingly referred to as “Jake Peavy Surgery”, since his successful return shows that this can be an effective treatment for other pitchers who suffer the same injury in the future.

The surgery was deemed a success, however, and the surgeon who performed the operation has called the issue a “non-factor” for Peavy going forward.

And since coming back from the surgery in May of 2011, he’s pitched well enough to back up the doctor’s assessment. He’s made 50 starts, thrown 331 innings, and posted a 3.96 K/BB ratio that is the fourth best in the AL over the last two years — only Dan Haren, Justin Verlander, and CC Sabathia are ahead of him.

Problems with the long ball and an inability to strand runners in 2011 pushed his ERA through the roof, but his peripherals remained strong, and he went beyond regressing to the mean last year, posting a 3.37 ERA in the process. Overall, the swings between years have essentially evened out, as his career ERA-/FIP-/xFIP- line is an even 85/85/85 across the board. There’s no reason to think that Peavy is a pitcher whose results are going to differentiate wildly from his underlying skills, and those remain quite strong at the moment.

Even if we add in some age related decline — he will turn 32 next May — and bring him back to 5-10% above average in terms of run prevention, that still works out to a +3 win pitcher at 150 innings or a +4 win pitcher at 200 innings. Projecting him for 200 innings is probably too aggressive even though he threw 219 last year, but 160-180 is a fair expectation based on his track record and the fact that he hasn’t shown any ill effects since the surgery. If you’re optimistic about his health and performance, you might expect +7 wins from him over the next two seasons. A pessimist would probably be closer to +5 wins.

Either way, that puts this deal at between $4M to $6 million per win, or right about where the market has priced wins over the last few years. It’s not a huge steal, but getting market price wins for a quality pitcher on a short term deal is a pretty good move for a franchise attempting to win in the short term. The two-year term limits the White Sox exposure if Peavy gets hurt again, and at this AAV, they still afford to fill out their roster around him in order to make a run at the AL Central title.

Peavy’s lengthy medical records likely ensure that he’s never going to get a long term deal again, but he probably could have landed a three year contract for a little more money had he tested free agency. That the White Sox were able to keep him around without guaranteeing that third year makes this a nice first official signing for new GM Rick Hahn, as the team keeps their best pitcher in place without opening the organization up to long term problems if Peavy’s arm gives out again.



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Dave is the Managing Editor of FanGraphs.


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JD
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JD
3 years 8 months ago

Everything I see suggests the 2015 option is a player option dependent on innings pitched in 2013/2014. Also, he’ll receive the $4M buyout in installments from 2016-2019.

Felonius_Monk
Guest
Felonius_Monk
3 years 8 months ago

That’s probably fine though. Realistically, unless his arm explodes right at the end of 2014, they’re likely to want him back for one more year if he’s been healthy through 2013-14.

Ned
Guest
Ned
3 years 8 months ago

What does this mean for the Sox’s chances at improving at 3b and catcher. With both Floyd’s option exercised and now this, it seems like the payroll is right around where they are expected to be at going forward. With that being said, I really like this move. I’m sure the Sox feel better about Peavy’s health than some other teams considering their excellent training staff.

Vinnie
Guest
3 years 8 months ago

For catcher, I’d be happy to see them hand Flowers the job and see what he can do as the full-time starter. Third could be a problem though.

MikeS
Guest
MikeS
3 years 8 months ago

Don’t be so sure they won’t trade Floyd now or at the deadline. Especially at the deadline if they are out of it. If they do, I could see them looking for a real live MLB sorta ready 3B prospect.

AJP
Guest
3 years 8 months ago

It’s more of a pipedream then I believe it can be a reality, but I would really love to see the Sox target Headley this offseason.

Vinnie
Guest
3 years 8 months ago

Not to hijack the comment thread, but what do you think the Sox do to fill third? Youk on the open market? Chavez? Actually give Morel another shot?

Otter
Guest
Otter
3 years 8 months ago

A Chavez/Polanco platoon would be interesting.

Sox need a left fielder too.

Vinnie
Guest
3 years 8 months ago

How about the Melk Man?

MikeS
Guest
MikeS
3 years 8 months ago

Viciedo will be 24 next year. Everybody is aware of his problems, but I think it’s a bit early to give up on him.

Vinnie
Guest
3 years 8 months ago

Just to be clear, I wasn’t seriously suggesting they should sign Melky Cabrera to replace Viciedo. I agree that Viciedo has shown enough to stick with him.

Joe O
Guest
Joe O
3 years 8 months ago

Sox do NOT need a LF. Viciedo is a big bat who is getting better discipline, and had probably one of the best LF arms in baseball. His defense is below average (glove is solid, range is bad, arm is plus), and his contact and walk rates need to improve, but when he sizes one up, he crushes it. I wouldn’t be shocked if he became a 30-35 HR guy at some point in the next couple years.

Felonius_Monk
Guest
Felonius_Monk
3 years 8 months ago

The Cardinals’ Matt Carpenter is probably at least average, if not a tick above at 3B, and blocked by Freese (though he’ll probably get 400+PAs as a corner backup next year). Cards seriously need middle infield depth, either major league or prospects. Not really sure if the Sox are an ideal trading partner in that respect, but it’s worth considering.

maxjusttyped
Member
maxjusttyped
3 years 8 months ago

It’s a matter of semantics, but Chris Sale is “their best pitcher”, not Jake Peavy.

Matt
Guest
Matt
3 years 8 months ago

Was just going to make this same comment.

MikeS
Guest
MikeS
3 years 8 months ago

Did he give them a discount to stay in Chicago? Could he have gotten more on the open market?

I tend to think so, but I am interested in other opinions.

RationalSportsFan
Guest
3 years 8 months ago

My guess is Peavy was unlikely to get a higher per year deal, but could have gotten another year on the open market. There may have been a 3/36 out there, but I doubt anyone would give him more than 2 years at more than 14.5MM.

Eric R
Guest
Eric R
3 years 8 months ago

But he had the $4M buyout, so to break even, he needed just 2/$25M…

JS7
Guest
JS7
3 years 8 months ago

Peavy is having himself a day – won a Gold Glove too.

Choo
Member
3 years 8 months ago

This deal is the equivalent of a qualifying offer at the 2013 minimum ($13.3 mil) plus the estimated 2014 minimum. Am I misreading the market? I would think Peavy could have taken his $4 mil parting gift and signed this exact same deal or better with another team, and without too much trouble. Or he could have gobbled up his $22 mil this season only needing something between a 2012 Aaron Harang and Freddy Garcia deal in 2014 to break even or better.

Matt
Guest
Matt
3 years 8 months ago

Jeez Choo effin Downer. Maybe he likes Chicago. Not all players squeeze every last drop – see the Braves, plenty of homegrown players have stuck around for less than they could have gotten elsewhere. Plus early security.

Choo
Member
3 years 8 months ago

Don’t get me wrong – I love when ballplayers do that and hope that’s the case. I just wanted to hash it out to see what Peavy might have left on the table and to get a few comments in the process.

DD
Guest
DD
3 years 8 months ago

Chi Sox could have gotten a similar, healthier, younger pitcher on the FA market, who was on their team recently, for the same money, just add one or two years – Edwin Jackson.

sox2727
Guest
sox2727
3 years 8 months ago

They already tried the Edwin Jackson experience once…

DD
Guest
DD
3 years 8 months ago

New GM and new head coach

Cidron
Member
Cidron
3 years 8 months ago

same fans (and fan tolerance)

Vinnie
Guest
3 years 8 months ago

I’d much rather have a healthy Peavy than Edwin Jackson.

Matt
Guest
Matt
3 years 8 months ago

Plus isn’t Edwin still with Boras? If so, no they couldn’t have. Although I’m thinking that maybe I read somewhere he switched agencies…

payroll
Member
payroll
3 years 8 months ago

That 2015 option is a player option so if Peavy stays healthy, its a 3/44 deal). Peavy had said he wanted to stay in Chicago and with this contract I’d say he’s giving them a slight but probably fair discount.

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