Quote:
Originally Posted by Jay Random
Skinner was getting paid $9 million a year on his last deal. He lost a third of that due to being bought out. Now he is getting $3 million on a one-year deal – so he makes back exactly what he lost this year, but he has less guaranteed money in the future. On top of that, he has to wait longer to collect the money Buffalo owes him, and I promise you his discount rate is not zero.
It was not in his financial interest to force a buyout.
|
Skinners cap hit was $9MM for 3 remaining years, but he only had $22MM of cash left, it was front loaded. He gets $14.67MM from Buffalo, so he needs to make up $7.33MM in the 3 years to come out ahead. Given he got $3MM from the oilers this year he only needs $4.33MM combined the last 2 years to beat that deal. I think he makes it, but it could be close.
There might be some tax benefits to having the money paid out later that could potentially offset the time value of money issue, depending where he lives post-NHL.