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White Sox Trade Santos, Start the Rebuild Process

The White Sox traded Sergio Santos to the Blue Jays for prospect Nestor Molina today. It was a bold move, not only because of the particulars of the trade, but because of the implications. For a hyper-competitive General Manager like Kenny Williams, it must be hard to admit that it’s time for a rebuild. At least he seems comfortable with it.

The trade at first seems like a head-scratcher. Santos is signed to three-year, $8.25M contract through 2014, with three options that could raise the deal to $30 million over the next six years. Even among relievers, who don’t usually average more than two wins a season, the contract should remain reasonable throughout. It’s a team-friendly homecoming for Santos, who was an infielder in the Toronto organization before he was converted — successfully — to relief in Chicago. Why trade such a valuable piece?

The return is exciting. Molina was given a B+ ranking from John Sickels, who rated him the second-best prospect in the Jays’ organization. In 130.1 innings between High-A and Double-A last year, Molina struck out 148 batters against a mere 16 walks. At 23 next year, he might only need a little more seasoning at Double-A before he can join the big leagues.

If he stays a starter, Molina will only need to be worth about as much as Paul Maholm has been worth over the last six years (13.2 WAR) in order to surpass Santos’ absolute value. Paul Maholm never had a minor league K/BB rate like Molina’s and was never a top-two prospect for the Pirates, but it’s still possible that Molina as a starter doesn’t achieve those heights.

And it is this uncertainty that shifts the needle back to equal. Molina may be a starter, or he may be a reliever. Scouts are divided on his stuff — is he a pitchability guy that has great control and decent stuff, or is he something more — and it’s even possible that a little recoil in his delivery might send him to the bullpen, in which case the value on this trade shifts towards Toronto.

One last point about the trade itself. As good as Santos’ contract seems, $30 million over six years would only provide great surplus value if he continues to average 1.6 WAR per season for the next six years. He’s only 28 years old, but the fact remains that only four closers — J.J. Putz, Matt Thornton, Mariano Rivera and Jonathan Papelbon — have averaged 1.6+ WAR over the past six years. Francisco Rodriguez, Joe Nathan, Rafael Betancourt and Jonathan Broxton have all managed over 1.5 WAR, and with Santos’ strikeout rate he could join the group.

If we give Santos nine WAR over the next six years, and $10-15 million in surplus value at current dollar/WAR numbers, the deal seems fair. In 2008, Victor Wang found that the surplus value on a Grade B prospect from Sickels was $7.3 million. Add the plus in, and inflation, and it wouldn’t be a stretch to call the trade fair.

But the questions still remains: why start the rebuilding process by trading Santos, the most reasonable and valuable trade chip the White Sox might have? The answer might lie with perception.

Once a team begins a rebuild process openly, the vultures begin to swarm. Going forward, the White Sox will receive buy-low offers on virtually every one of their major league players on veteran contracts. They may complete some of those trades, but the perception of their team as rebuilding will shift the power towards the buyers. In other words: if they were deep in an obvious rebuilding process, their stance that Santos was very important to their team wouldn’t hold much water in negotiations.

So if you have one really good trade chip on a team mostly made up of also-ran veterans on iffy contracts, it could make sense to trade your one good piece first. For the best prospect you can find. And then you announce that you are rebuilding, so that you can field the less exciting offers for the rest of your team.