Roy Oswalt trade official: now a Philadelphia Phillie

Roy Oswalt is officially a Philadelphia Phillie. He was traded for J.A. Happ, and prospects Anthony Gose and Jonathon Villar. The Astros will give Philly $11mil and Oswalt’s buyout is now mutual and worth $2mil.

Not too long ago I broke down a possible Roy Oswalt trade. I wrote:

Well, so far he has a 2.9 WAR. Using the ZiPS projection on FG, he should have a 3.48 FIP over 82 more innings. So lets say that roughly comes out to about a 2.0 WAR. With the current market rate of a win around $4mil, lets simply do $4mil x 2.0 WAR = $8mil. That also means his total WAR in 2010 would be 4.9. Looking at 2011, let’s dock him the traditional 0.5 wins from his WAR. So if he has a 4.4 WAR in 2011 with a market rate of $4.4, his value would be $19.36. Adding up his rest of 2010 value and 2011 value, results in a total value of $27.36mil. He would be paid about $21mil during that time. So he brings the Phillies a net value of $6.36mil. However, if he is still a Phillie after 2011, he has a $16mil club option with a $2mil buyout. I’d say there is a good chance he is bought out, at which point he’d be a type A free agent. So dock $2mil from his current total value to the Phillies, and then add in $10mil for the two picks the Phillies would get for him. Now the Phillies have a total net value of $14.36mil in a trade.

Things have changed a little bit since then. At this point in time, the Phillies would have to pay him about $5mil for the rest of 2010, $15mil in 2011, and $2mil with a buyout prior to 2012. That’s a total of $22mil. However, the Astros are forking up $11mil, so the Phillies would end up paying Oswalt just half of his $22mil. Subtract $11mil from his projected total value of $27.36 and you get a net value of $16.36mil. However, if Oswalt is bought-out or he declines to be picked up in 2012, he will file for free agency and it will be clear he will be heading to a new team. So the Phillies can offer arbitration and assuming Oswalt declines, and the Phillies will get two draft picks. Those picks are worth $10mil so add that to the $16.36mil and now the net value of Oswalt to Philly is $26.36mil.

How did Houston fare? The main player in the deal from their perspective is J.A. Happ. Happ is a nice, young, cheap lefty who profiles as a solid #3 starter. He had a 1.8 WAR as a rookie in 2009, but has been hurt for much of 2010. Assuming he develops into a good #3 SP, I will project his peak WAR to be 3.5. If his WAR increases by about 0.5 each season going forward, in 2011 he will have a 2.3 WAR, a 2.8 WAR in 2012, a 3.3 WAR in 2013, and a 3.5 WAR in 2014. Without adjusting for inflation, and using a market rate per win of $4.4, his value would be $52.36mil. For 2011, lets say the teams agree on a 500k contract. In 2012 he will be arbitration eligible, where off my head lets say he is given $3.5mil. Using the 40/60/80 scale, lets say he is paid $5.6mil in 2013 and $10.1mil in 2014. That brings his net value to $32.66mil.

Seems like a good deal for Houston so far, right? Well, not quite. With Happ we’re projecting years into the future. He may never reach his potential and could be a 1-2 WAR going forward rather than a 3 WAR pitcher. Maybe he will be paid more or less than I have him pegged for. I mean, I did all those projections in a best case scenario for Houston. Odds are, he will be a mediocre, back end of the rotation starting pitcher. If that happens, Houston should ashamed all they are really getting for Oswalt and J.A. Happ. Lets look at a more realistic scenario.

Happ posted a 1.8 WAR in 2009, but he didn’t have the best periphs. He’s given up 1.12 HR per nine in his career so far, and he had a high HR rate in the minors as well. That is due to a high FB% which is 43.5% in his young career. He will be going to Minute Maid, which has a notoriously short porch in left field. That could spell DOOM for Happ. Let’s see averages a 2 WAR over the next four seasons but is paid the same. That would be $35.2mil in value, but after paying him, his net value would be $15.5mil. Suddenly, it’s not such a good trade for Houston.

As for the other prospects, both are a long time away. Anthony Gose is a top ten Phillies prospect, but I don’t think he is anything special. He has great speed (76 stolen bases in 2009) and is supposed to be an amazing fielder. But he can’t hit. He is young and can improve- I mean he was a high round draft pick in 2008. But at best I see him being a Carlos Gomez type. In other words, I think he is a fringe starter-bench player. The prospect is Jonathon Villar. He is intriguing because he is 19 and still years away. He was an international signing and has had okay numbers for the type of prospect he is. If we say both are C level hitting prospects, then total they would be worth $1.4mil.

Overall, I think the deal is fair. But it’s a tough trade to analyze. As Dave Cameron writes:

There will be no easy way to analyze a Roy Oswalt to Philadelphia trade. If this deal happens, it will not lend itself to sound byte analysis, and no one will be able to sum up what is going on in 50 words. It’s complicated, perhaps more so than any recent trade. In the end, it may end up as just a part of one of the most interesting, confusing, and talked about series of acquisitions and departures in baseball history.

For me, the deal hinges on Happ. If he becomes a good pitcher, he will be fair value for Oswalt since he’ll be under contract for four years, be a good player, and will be cost efficient. But if he stays an average pitcher, the Astros will not have gotten a good return. Oswalt is a very good pitcher and the Astros will be eating half of what he is owed. If all they get is a back end of the rotation pitcher and two not so special prospects, well, the trade will be considered a disappointment. In my opinion, come 2014, we might be saying the Astros got fleeced.

As for the Phillies, it’s a good trade. They acquired a front end of the rotation starter who will keep alive them in the pennant chase this year, and figures to make them NL favorites in 2011 as well. And they did so without giving up anyone too special.

I know I didn’t look at this trade without looking back at the Cliff Lee trade. But in terms of the current Phillies roster and situation, it’s a solid move. Granted having Lee would change things, but they don’t have Cliff Lee. All I want to say is Ruben Amaro seems intent on destroying the franchise. He trades Lee when he didn’t need to, and got a horrible return. Then he signed Ryan Howard to a ridiculous long term deal which will force them let Jayson Werth walk as a free agent at the end of the year. But give him credit for this trade.

In the end, I will call the Phillies winners and the Astros probable losers.

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