Making Sense of Sefolosha

By John Hollinger

The Thunder extended Thabo Sefolosha for four years today, and I know what you’re thinking: Why now? Who was coming after this guy with big free agent bucks?

Here’s the answer, and it has to do with cap management. Let's start with the basics: The Thunder are set to have a trove of cap space next summer, around $15 million depending on the cap holds for their two first-round draft picks and where the final cap number comes in.

However, that number would be cut in half by another cap hold – the one on Sefolosha if he became a restricted free agent. Because he was taken with the 13th pick in the 2006 draft, the cap hold on Sefolosha would be $8.1 million next summer. That, in turn, would eat up half the available money for the Thunder’s foray into free agency, a big enough dent to leave them out of the running for next summer’s star players.

If they didn't extend him now, the only way around it would be to either quickly agree to deal with Sefolosha next summer before pursuing free agents, or to renounce his rights entirely and make him an unrestricted free agent. The first option would basically leave the Thunder over a barrel if Sefolosha’s agent is worth his salt, and the second is unappetizing since Oklahoma City views the defensive ace as part of its core going forward.

Thus, extending him today – to a four-year deal with a first-year salary, I’m told, that’s less than half his cap hold – allows the Thunder to go forward with a much bigger trove of cap space next summer while still preserving the asset. In the NBA's current financial climate it's unusual to extend a role player before he hits restricted free agency, but in this particular case it made a ton of sense as a cap management strategy going forward.