sports

Why did Shohei Ohtani reject a deal like Juan Soto's? Here's why he said no

Shohei Ohtani, the Japanese baseball superstar, recently signed a groundbreaking 10-year, $700 million contract with the Los Angeles Dodgers. However, it was his decision to forgo a 15-year deal that has caught attention.

Learn why Ohtani chose a more flexible deal and what it means for his future. Photo: AFP
Learn why Ohtani chose a more flexible deal and what it means for his future. Photo: AFP

In an era where long-term, multi-million dollar contracts are becoming more common, the news surrounding them often isn’t just about the lucrative numbers, but also the hidden complexities that aren't always apparent when the deal is signed. This could be the case for one of the pioneers of such contracts in U.S. sports, Japanese baseball player Shohei Ohtani, whose details of his deal with the Los Angeles Dodgers have just come to light.

The impressive and versatile athlete from Oshu, Iwate, Japan, could have easily secured a 15-year contract until he turned 44. However, he chose not to do so for a commendable reason.

Shohei Ohtani declines a 15-year-contract with Los Angeles Dodgers

"Ohtani didn't want to risk a decline in his performance," said his agent Nez Balelo last Thursday. He explained that the Eastern superstar didn’t want to jeopardize his abilities over the course of such a long contract. Instead, Ohtani signed a 10-year deal with the Los Angeles Dodgers.

Balelo shed some light on Ohtani’s mindset while speaking at the Invest West conference organized by Sportico, which gathered sports, entertainment, and finance professionals at the new Intuit Dome, home of the Los Angeles Clippers.

Ohtani’s 10-year, $700 million deal with the Dodgers, signed in December 2023, was the largest contract in professional sports at the time. Ohtani had already won his third MVP award and his first World Series title in his first season with the Los Angeles Angels.

One year later, Dominican outfielder Juan Soto would land a bigger deal, signing a 15-year, $765 million contract with the New York Mets, with no deferred payments.

"We made the right decision signing with the Dodgers," Balelo said. "There’s nothing we do differently. He won a championship, went to the right team. No regrets." Part of Ohtani’s contract contains $680 million to be paid at a later date and this “deferral”, or sense and slope at which the money is going to be paid “decreased the present net value” from about $680 million to about $461 million for Major League Baseball’s luxury tax purposes, when amortized over 10 years, versus an average $70 million a year for 10 years theoretically, not deferring any of it.

Ohtani would be 38 years old when his contract expires at the conclusion of the 2033 season. Ohtani didn't want a 13-, 14- or 15-year deal, "because he wanted to maintain the integrity of his career. He didn't want to (let) his dream career slip away. He didn't want to get to year 13, 14, or 15 and be like, 'Who is this guy? This guy is not even a player anymore,'" Balelo said.

Ohatani is focused on his legacy

Ohtani is considering his legacy, his reputation, and his future. His main objective was to make sure that his new team would remain competitive so that the team could pay for other players winning championships and entertaining the idea of remaining a two-way player. "The Dodgers assured us that is what they would do," Balelo said.

At present, Ohtani is the largest sponsor of MLB, and his earnings will jump from $65 million in 2024 to $100 million this year. The Japanese star is a part of 20 plus carefully chosen brands based on using their products and his faith in the companies and their people. However, Ohtani's main priority is to perform on the field and the training needed to get to the level of performance.

"He takes it very seriously and everything else is secondary, except for his family. We have to make sure he's not being overly exposed, or in a position that creates too much of a burden," Balelo said.

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