Orioles reach agreement with Chris Davis on seven-year deal (updated)

Just as it appeared that the Orioles were moving away from Chris Davis, they reached agreement to keep the free-agent first baseman in Baltimore.

A source confirmed this morning that Davis has agreed to terms with the Orioles following a lengthy period of stalled negotiations.

The club had a seven-year, $150 million offer on the table that included deferred money and was unwilling to budge from it, but a source confirmed that Davis will receive $161 million over seven years. The deal is pending completion of a physical.

The Orioles made an offer to outfielder Yoenis Cespedes, believed to be five years for about $90 million, as they sought a bat for the middle of their lineup. However, managing partner Peter Angelos has been pushing for an agreement with Davis' representative, Scott Boras, despite the increased frustration over an inability to finalize the deal.

In the end, the Orioles get to keep a popular player who has led the majors in home runs in two of the past three seasons. They also have handed out the largest contract in franchise history.

Center fielder Adam Jones signed a six-year, $85.5 million extension in 2012.

The Orioles have retained three of their six free agents, including catcher Matt Wieters and reliever Darren O'Day. Wieters took the $15.8 million qualifying offer and O'Day re-signed for $31 million over four seasons.

Left-hander Wei-Yin Chen and outfielder Gerardo Parra signed with the Marlins and Rockies, respectively. Outfielder Steve Pearce remains on the market.

The Orioles acquired Davis, 29, and pitcher Tommy Hunter from the Rangers on July 30, 2011 for reliever Koji Uehara. He's hit .257/.341/.526 with 161 home runs in 617 games.

With Davis returning to the club, Mark Trumbo is expected to get most of his at-bats as the designated hitter. The Orioles would rather not use him regularly in the outfield, though it remains an option.

The Orioles still need to address their rotation after losing Chen.

MLB Network's Jon Heyman first reported the deal with Davis.

Update: Davis' deal includes a full no-trade clause and no opt-out clause.