The Cincinnati Reds and Johnny Cueto have agreed to a four-year, $27 million contract extension, according to Enrique Rojas of ESPNDeportes.com. The deal is pending a physical.

The sides originally submitted numbers by the deadline this week, but the extension allows them to avoid the arbitration process.   Cueto asked for $3.9 million and the team offered $3 million.  His new contract will pay him an annual average of $6.75 million over four-years.

In mid-December, Rojas reported that the sides were open to discussing a contract extension.

Cueto, 24, was 12-7 in 31 starts last season for the Reds.  The contract buys out all of his arbitration years and his first year of free agency.  The right-hander will be eligible to test the free agent market in 2015.