Does it Pay to Acquire UFA Rights?

Three things dominate the minds of hockey fans today: the Stanley Cup Finals matchup between Boston and Vancouver; the upcoming draft and; the unrestricted free agency period beginning July first. It’s probably fair to assume a majority of hockey fans are more interested in what their favorite team does in the draft and/or free agency rather than who wins the Cup. With that in mind let’s talk free agency.

The top skater on this market is Dallas center Brad Richards. I would consider Teemu Selanne or Nicklas Lidstrom but since they are both either re-signing with Anaheim and Detroit respectively or retiring, I felt it prudent to remove them from consideration.

Several teams would love to add a talent like Richards to their fold. New York has been rumored to be a likely destination and it’s believed both Toronto and Los Angeles might get involved in talks with Richards’ representation should he reach free agency. Dallas, if they can get their ownership situation squared away, could also re-sign the skilled pivot.

With so much potential competition it’s been suggested by some that an interested team should take the proactive step of dealing for Richards’ rights prior to July 1st. This would give that team an exclusive window with which to negotiate with Richards’ camp before anyone else.

It’s been done before on several occasions with mixed results. Philadelphia dealt a first-round draft pick to Nashville in 2007 for right winger Scott Hartnell and defenseman Kimmo Timonen and was able in each case to extend the player prior to July 1st.

Calgary reached an agreement with Florida two summers ago and acquired the rights to soon-to-be free agent defenseman Jay Bouwmeester then agreed to terms with him before he officially hit free agency.

Last season Philadelphia, going back to a successful formula, dealt a draft pick to Nashville for the negotiating window with D Dan Hamhuis. When it became clear to Flyers management that they would not be able to get Hamhuis’ name on a contract they sent his rights on to Pittsburgh who also failed to sign the defender. Hamhuis would eventually sign with Vancouver.

In the cited examples, the rights to five players (I’m counting Hamhuis twice) switched hands before free agency with three agreeing to deals with their new clubs before officially hitting free agency or at least without seriously entertaining offers from other clubs.

This would seem to reinforce the notion that it’s a good idea for a club to proactively agree to acquire the rights to a player, in this case Richards, and use the period of exclusivity to convince him to sign with them. Signing the player is only part of the objective, however.

Another of the believed advantages to trading for a player’s rights in advance of July is to remove the possibility of a bidding war. By keeping him from speaking with other clubs it is hoped that his eventual price tag is lower than what it may have been had other squads been allowed to bid for his services.

It makes sense in theory but has it worked out that way in reality? Let’s see how it worked out in the cases referenced above.

First off, here are the ground rules. For any type of comparison involving players of different positions, we at the School of Stats like to use Tom Awad’s Goals Versus Threshold (GVT) metric. We’ve profiled it before and it’s the best thing around at this point in incorporating every aspect of player contribution into one neat little number.

Also, since we’re judging players who recently agreed to new deals, we need to identify other players who make similar salaries and who have also signed new contracts around the same time as the above players.

In addition, I believe it’s important to compare the GVT’s of each player the season before they signed their new deal and also the three year period from the 2007-2008 to 2009-2010 (I do not yet have the numbers for this season) seasons for added context and a larger sample size.

Here we go. (Note: I am omitting Dan Hamhuis from this exercise since neither of the clubs that traded for his rights succeeded in signing him.)

Free Agent

Scott Hartnell
Signed: 2007
Cap Hit: $4.2 MM
2006-2007 GVT: 9.0
2007-2010 GVT: 26.8

Comparables

Patrick Sharp
Signed: 2008
Cap Hit: $3.9 MM
2007-2008 GVT: 16.3
2007-2010 GVT: 45.5

Ales Hemsky
Signed: 2006
Cap Hit: $4.1 MM
2005-2006 GVT: 13.5
2007-2010 GVT: 31.7

Dustin Penner
Signed: 2007
Cap Hit: $4.25 MM
2006-2007 GVT: 7.8
2007-2010 GVT: 21.7

What’s this tell us when comparing Hartnell’s cap hit and production with those of his comparables? Since Hartnell was out produced by two players making less per year, I don’t see much in the way of an argument that Philadelphia achieved any savings by securing exclusivity.

Sure, Hartnell has been better than Penner but Edmonton was in a unique position since they had been unsuccessful luring any quality UFA’s to Alberta. They were forced to go the way of the RFA offer sheet and the move was widely panned at the time it was made.

How do the defenseman compare?

Free Agents

Kimmo Timonen
Signed: 2007
Cap Hit: $6.333333 MM
2006-2007 GVT: 15.3
2007-2010 GVT: 32.5

Jay Bouwmeester
Signed: 2009
Cap Hit: $6.68 MM
2008-2009 GVT: 8.8
2007-2010 GVT: 23.5

Comparables

Nicklas Lidstrom
Signed: 2010 and 2008
Cap Hit: $6.2 MM (2010-2011) and $7.45 MM (2008-2010)
2009-2010 GVT: 20.5
2007-2008 GVT: 23.9
2007-2010 GVT: 64.5

Dan Boyle
Signed: 2006
Cap Hit: $6.666666 MM
2005-2006 GVT: 13.9
2007-2010 GVT: 34.9

Dion Phaneuf
Signed: 2008
Cap Hit: $6.5 MM
2007-2008 GVT: 17.8
2007-2010 GVT: 34.8

That would appear to have worked out even worse for the acquiring teams. Philadelphia committed a ton of money to Timonen yet received less value than delivered by Phaneuf, Lidstrom and Boyle. Yes, he’s making a little less than both Boyle and Phaneuf but not enough to offset the loss of value.

Lidstrom, as pointed out earlier, is a special case due to the fact he would never leave Detroit and he probably took less to remain a Red Wing on his last deal.

Regardless, did sacrificing a 1st round pick improve Philadelphia’s chances of signing Timonen and Hartnell? Sure it did. But did they get a better deal in terms of contract terms? I think the evidence suggests they didn’t.

The same can be said relative to Jay Bouwmeester. He received a contract with a higher cap hit than any other defender listed yet delivered the lowest GVT both the season before getting his new deal and for the three-year period from 2007-2010.

I’m not arguing that it is a bad move to give up assets to secure an exclusive negotiating window with a pending UFA. I am saying not to expect any savings on any new deal reached with the pending UFA despite thoughts to the contrary.

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