Erik Karlsson Joins Pittsburgh Penguins In NHL 3-Team Blockbuster Deal

The most-anticipated NHL trade of the summer is finally in the books. After months of speculation, the Pittsburgh Penguins have acquired 2023 Norris Trophy-winning defenseman Erik Karlsson from the San Jose Sharks.

The final deal also included the Montreal Canadiens as a third party, with nine players and three draft picks included in the full deal.

Karlsson is very much the centerpiece of the deal. Now 33 years olds, the right-shooting Swede won the third Norris Trophy of his career last season after posting 101 points, the most by any defenseman in more than 30 years — since Brian Leetch of the New York Rangers logged 102 points in the 1991-92 season.

After Karlsson acquired from the Ottawa Senators in a blockbuster trade in September of 2018, the Sharks reached the Western Conference Final in his first year with the team. But San Jose has missed the playoffs in four subsequent seasons, and even while Karlsson was putting together his historic personal-best season, he made it clear that he wanted to be playing in a market where he’d have a chance to chase the Stanley Cup.

Pittsburgh is a good fit: very much in win-now mode after committing to veterans Evgeni Malkin, Kris Letang, Bryan Rust and Rickard Rakell last summer and re-upping with No. 1 goalie Tristan Jarry this year — and with two years remaining on the contract of captain Sidney Crosby, who turns 36 on Monday, at a very reasonable cap hit of $8.7 million.

Karlsson has four years remaining on an eight-year deal that he signed in San Jose in 2019. It carries an annual cap hit of $11.5 million, currently fifth-highest in the league per CapFriendly.

CapFriendly also reports that San Jose will be retaining 13 percent of Karlsson’s salary for the duration of the contract. That works out to a cap hit of $1.5 million, which leaves $10 million a year on the Penguins books.

For the first time since Crosby was on his entry-level contract at the very beginning of the salary-cap era, a player has slotted in above him on Pittsburgh’s salary chart. But given Crosby’s clout within the Penguins organization, it seems safe to assume that he would have approved the deal before it came to pass.

It’s the first major swing in Pittsburgh for Kyle Dubas, who was hired as the Penguins’ president of hockey operations on June 1, after former president Brian Burke and general manager Ron Hextall were let go. Running the show in Pittsburgh through the draft and free agency, as well as swinging the trade that brough Reilly Smith into Pittsburgh from the Vegas Golden Knights on June 28, Dubas officially added the general manager title to his job description earlier this week.

Impressively, Dubas was able to improve Pittsburgh’s salary-cap situation with the Karlsson trade, even while adding a $10 million contract to his roster.

Five players have been moved out: forward Mikael Granlund and Nathan Legare, defensemen Jeff Petry and Jan Rutta and goalie Casey DeSmith.

Granlund was acquired by Hextall ahead of the 2023 trade deadline in hopes of adding scoring punch. But he produced just five points in 21 games, and Pittsburgh slumped down the stretch and ended up missing the playoffs — triggering the management change. At 31, he lands in San Jose, with a cap hit of $5 million for the next two seasons.

Legare is a 22-year-old right winger who has spent the last two seasons in the AHL. A native of Montreal, he lands with the Canadiens.

Petry returns to Montreal, one season after he was acquired by the Penguins in what was essentially a swap for defenseman Mike Matheson. Also a right-shot blueliner, the 35-year-old’s departure opens up the required roster spot for Karlsson. Petry has two years remaining on a contract that carries a cap hit of $6.25 million. Per CapFriendly, the Penguins are retaining 25 percent, or $1.56 million per season, so they clear $4.69 million with Petry’s departure.

Petry’s inclusion may also be part of the reason why it took awhile for this trade to be finalized. As we learned earlier this summer, when the Philadelphia Flyers tried to trade Tony DeAngelo back to the Carolina Hurricanes, a full calendar year must elapse before a player can be dealt back to a team when there’s a salary-retention component involved. Petry was initially traded from Montreal to Pittsburgh on July 16, 2022.

Rutta is also a right-side defender, who plays further down the lineup. Now 33, he was signed to a three-year contract by the Penguins as a free agent in 2022. He lands in San Jose with two years remaining on his current deal, at a cap hit of $2.75 million.

DeSmith is a 31-year-old goaltender who was originally signed by the Penguins as a college free agent out of the University of New Hampshire. He is in the second year of a deal that carries a cap hit of $1.8 million, and lands in Montreal. The signing of UFA goalie Alex Nedeljkovic at $1.5 million on July 1 made DeSmith expandable.

So, the total cap hit out from those four NHL salaries adds up to $14.23 million.

When the dust settles, the Penguins also add 26-year-old utility forward Rem Pitlick from Montreal, at a cap hit of $1.1 million, and 22-year-old minor-league forward Dillon Hamaliuk, while winger Mike Hoffman moves through Pittsburgh and lands in San Jose.

And the draft picks that were required to make it all work: Pittsburgh sends their top-10 protected 2024 first-rounder to the Sharks and their 2025 second-rounder to Montreal, and San Jose sends a third-rounder in 2026 back to the Penguins.

All told, the Sharks add nearly $4 million in salary-cap commitments despite offloading Karlsson’s big ticket. But Granlund and Hoffman join free-agent signing Anthony Duclair to help provide some additional scoring punch following the departure of Timo Meier to the New Jersey Devils and Rutta can help fill Karlsson’s minutes on the back end. The player commitments are also relatively brief. Hoffman is set to become a UFA at the end of the 2023-24 season, while Rutta and Granlund are both signed for two years.

Are the Sharks better? We won’t really know the answer until we see how that first-round draft pick turns out. But Grier was backed into a corner by Karlsson’s trade demand and did what he had to do.

Are the Penguins better positioned to win a championship? They should be. It’s unlikely that Karlsson can repeat with another triple-digit season, but it’ll be fun to watch him work his magic with Crosby and company this fall.