Leon Draisaitl is skating into the future.
The Edmonton Oilers star center is now the NHL’s highest-paid player after signing an eight-year contract extension worth $112 million. The average annual value of $14 million is the highest in NHL history and second overall richest contract ever behind Alex Ovechkin’s $124 million deal in 2008.
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The Oilers wanted to lock up the 28-year-old after the franchise came one victory away from winning the Stanley Cup in June. The historic contract, which points to the health and trajectory of the league, means Draisaitl will incur the highest salary cap hit in NHL history but gives the rest of the league a sense of what chips will be available at future negotiating tables. The current collective bargaining agreement (CBA) is set to expire after the 2025-2026 season.
“We’re peering into the future,” Mike Liut, Draisaitl’s agent and the managing director of Octagon Hockey, said in an interview. “The historic nature of this will be a little bit like the NBA’s moment when the new media contracts took the salary cap up considerably. … There isn’t this influx of capital, but the salary cap has been artificially suppressed, and it’s going to spring forward over the next two years.”
The NHL salary cap next season will be $88 million, but that number should exceed $100 million in two years thanks to the pandemic recovery, with hockey-related revenue now surpassing the cap. It’s been quite the turnaround for the NHL, which has topped an all-time high of $6 billion in large part thanks to new media deals, rising stars, jersey sponsors, new sponsorship agreements and higher attendance. The current CBA, though, is still in its MOU phase due to uncertainty brought on by the pandemic and hasn’t quite caught up to today’s revenues. Executives and agents anticipate the cap will jump when the new CBA is struck.
It’s expected to be a solid pop based on the hockey-related revenues from the previous two seasons. “That will be our NBA moment or salary cap jump,” said Luit, a former NHL All-Star goaltender who helped put together the seventh contract in league history worth at least $100 million.
Draisaitl, who has brand deals with Puma, Sports Interactive, Warrior and others, will enter his 11th season with the Oilers this upcoming campaign, where he will play on the final year of his current contract ($8.5 million AAV). The German alternate captain returns to Edmonton, a small-market club that manages to finish regularly in the top 10 in team revenue with help from the Ice District Plaza, which was a hit during the team’s playoff run last year. Luit says that his client does have a relationship with Oilers owner Daryl Katz, which was helpful to secure such a hefty long-term deal. But he says these negotiations were done between him and Octagon agent Andy Scott, with general manager Stan Bowman, who joined the club in July, sitting across the table.
“From our perspective, it should’ve been higher and from their perspective, it should’ve been lower, and that’s how negotiations generally end,” Luit said, laughing. “But [Draisaitl] is all in on the Edmonton. That’s what he’s saying with this contract.”
It remains to be seen how this historic extension will impact Draisaitl’s partner in crime, league superstar Connor McDavid, who has two seasons left on the $100 million deal he inked with the Oilers in 2017. Bowman has already said the team is prioritizing keeping the duo and supporting cast together. But in the meantime, Edmonton signing its top center to a hefty extension suggests a time is coming where other NHL stars will receive $100 million-plus contracts on a more regular basis.
“Welcome to the future,” Liut said.
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