The Tampa Bay Lightning freed up some significant cap space by trading an injured Ryan Callahan to the Ottawa Senators on Tuesday morning. Callahan and the Lightning's 2020 fifth-round selection go to Ottawa in exchange for goaltender Mike Condon and a 2020 sixth-round draft pick.
With Callahan's $5.8 million cap hit going to the Sens and Condon's $2.4 million AAV coming back, Tampa Bay successfully frees up $3.4 million in cap space to use this offseason, which is a pivotal chunk of change as they look to sign restricted free agent center Brayden Point.
Now with just over $10 million in available cap space, the Lightning are in better position to extend the 23-year-old Point, who is emerging as a key two-way star in Tampa.
Callahan, who has one year remaining on his current deal, announced earlier this summer that he will not play again due to a degenerative back issue. The Senators will stash the 34-year-old on their Long-Term Injured Reserve list, which already includes the contracts of Marian Gaborik and Clarke McArthur.
Those three players combine for a $15.325 million LTIR cap total in Ottawa, helping the Senators reach the cap floor while paying less salary during their rebuilding process. Insurance will cover the payout for most of Callahan's salary this season.
Callahan will unfortunately spend the final year of his contract on LTIR due to injury— CapFriendly (@CapFriendly) July 30, 2019
As a result of the long term injury, the #Sens will only be responsible for paying $940k of his $4.7M salary, whereas the insurance in Callahan's contract will cover the remaining 80% ($3.76M)
The Lightning also could have stashed Callahan on LTIR once the season started, which would have allowed them to exceed the upper limit by $5.8 million, but this deal allows them to get a deal with Point done sooner.
From a roster perspective, the deal brings another goaltender to the Lightning, who now have a plethora of goalies with Andrei Vasilevskiy, Louis Domingue, Curtis McElhinney, Scott Wedgewood, Spencer Martin, Zach Fucale and now Condon.
In a team release, Senators GM Pierre Dorion says shedding Condon helps the Senators get a better picture of their goaltending situation for the upcoming season.
"We believe we have the right mix of goaltenders both for the upcoming season and the future," Dorion said. "We are pleased with how our young goaltenders have been developing in Belleville, so this trade allows us to focus on continuing their growth at a proper pace while keeping two established goaltenders here in Ottawa. Our cap flexibility allowed us to proceed with this trade, which will also benefit us as we continue making adjustments to create a hardworking, exciting team."
The Senators were willing to help the Lightning out of their cap crunch in order to save some cash this year, so the big takeaway here is that it's a deal that helps the financial situation of both teams while also likely frustrating the other 29 teams in the league.