(TNS) — The Royals confirmed Monday that the club will give qualifying offers to free agents Eric Hosmer, Mike Moustakas and Lorenzo Cain, ensuring some level of compensation should those players sign elsewhere this offseason.
All three players have 10 days to accept or decline the qualifying offer, according to the terms of the latest collective-bargaining agreements. All three players are among the top free agents on the market this winter and will almost certainly decline, which will send them to the open market.
The qualifying offer for 2018 is a one-year contract at $17.4 million.
The Star reported the Royals’ desire to hand out three qualifying offers last week. The club had nine players become free agents in the last week, including reliever Mike Minor, who declined his half of a mutual option for 2018.
The Royals are not expected to extend qualifying offers to Minor, starting pitcher Jason Vargas or shortstop Alcides Escobar. Outfielder Melky Cabrera and right-handed pitcher Trevor Cahill are not eligible because they were traded midseason. The other free agent is reliever Peter Moylan.
So if Hosmer, Moustakas and Cain decline the qualifying offer, why is it important? Because it will set the Royals up to gain three additional draft picks in 2018 if all three players leave.
Let’s review the compensation rules: The Royals will receive a compensatory, or additional, draft pick following the first round if a player declines a qualifying offer and signs a contract of more than $50 million. If the player declines the qualifying offer and signs for less than $50 million, the compensation pick will come after Competitive Balance Round B, which follows the second round.
In practice, the Royals could find themselves with three additional draft picks following the 2018 first round if Hosmer, Moustakas and Cain depart and all sign for more than $50 million, one reason among many the Royals were hesitant to sell off their main pieces before the trade deadline in 2017. Hosmer, 28, and Moustakas, 29, are expected to command contracts well beyond $50 million this winter, while Cain, 31, could as well — though it could depend on the length of his contract.
So could the Royals have extended qualifying offers to Vargas and Minor and attempted to gain more draft picks? Well, yes. But the risk would have been sizable. Based on their market values, Vargas and Minor would have likely accepted the offer, pocketed $17.4 million for 2018 and taken their chances at free agency again in 2019. Such maneuvers would blow a hole in the Royals’ budget for 2018.
In addition, Escobar, 30, is expected to sign for considerably less than either Vargas or Minor.
After receiving qualifying offers, Hosmer, Moustakas and Cain can still talk to other teams during the 10-day window. Those conversations could heat up next week when club officials from all 30 teams convene in Orlando for the annual General Managers’ meetings. Yet most major player movement will not take place until the month of December.