The San Jose Sharks kept defenseman Erik Karlsson past the 2023 NHL trade deadline with the intention to move him this summer. Now that the NHL offseason has arrived, Karlsson’s name is being floated heavily in trade rumors.
Karlsson, the reigning Norris Trophy winner, has generated significant interest in the trade market. The Toronto Maple Leafs, Carolina Hurricanes and Seattle Kraken have all emerged as suitors for Karlsson, eyeing him as a piece that can put them over the top.
- Erik Karlsson contract: $11.5 million AAV (2023-’27)
Related: NHL offseason schedule
However, Karlsson’s contract significantly complicates matters. The 33-year-old carries an $11.5 million cap hit through 2027, including a $10.5 million base salary next season and a $10 million base salary in 2024.
While the NHL salary cap is expected to climb by $10 to $12 million over the next three years, the COVID-19 pandemic and revenue issues from 2020-’21 resulted in the cap climbing by just $2 million in the last three seasons.
Karlsson’s $11.5 million AAV makes him the fifth-highest-paid NHL player in 223, just behind Auston Matthews ($11.64 million). It’s influencing what teams are willing to give up for Karlsson, who is entering his age-33 season. However, Sharks’ general manager Mike Grier has made it clear any trade won’t be a salary dump for San Jose.
“He’s not someone that we’re just going to toss aside and not take things into account and try and help the organization out.”
San Jose Sharks general manager Mike Grier on trading Erik Karlsson
As a majority of NHL teams focus on free agency in early July and with the 2023 NHL Draft in the rearview mirror, a Karlsson trade likely isn’t imminent. Once clubs have clarity on their rosters and cap space, though, things will get interesting.
Impact of Erik Karlsson contract on San Jose Sharks’ asking price
Ultimately, what San Jose receives in return and whether or not Karlsson is traded comes down to one thing. NHL teams want to know how much of Karlsson’s contract the Sharks are willing to cover this year and beyond.
According to Pierre LeBrun of The Athletic, San Jose is likely looking at a return that is heavily dictated by its willingness to eat a percentage of the contract. It’s a sentiment shared by NHL executives, with a specific breakdown of how things might look.
If San Jose is only willing to cover approximately $2 million annually – 17.3 percent of the deal – LeBrun believes the Sharks will receive very little in exchange. Absorbing $4 million per season – 30 percent of the contract – would likely receive a moderate return.
If the Sharks want to maximize Karlsson’s trade value, leaving him with a $7 million AAV and covering approximately 40 percent of his remaining salary – LeBrun believes San Jose would receive a significant return.
It puts the pressure on Sharks’ ownership to dictate what happens. San Jose had the second-lowest average attendance in the NHL last season and eating tens of millions of dollars would be extremely cost in the middle of the rebuild. If the Sharks want to improve their farm system, though, it’s the only way to make a deal happen.