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ARLINGTON, Texas - The Rangers acquired LHP Cliff Lee, one of the game's top pitchers, from the Mariners on Friday despite bankruptcy proceedings and unsettled ownership.

Seattle also sent RH reliever Mark Lowe, who is likely out for the year after back surgery, to Texas for rookie 1B Justin Smoak and three minor-leaguers. Seattle also sent $2.25 million to subsidize the $4.2 million still owed to Lee.

It was the third trade in less than a year for Lee, 31. He started 2009 with the Indians. But with his free agency coming at the end of 2010, they dealt him to the Phillies that July. Lee went 4-0 with a 1.56 ERA in five postseason outings last year, including 2-0 in the World Series.

After their offseason acquisition of RHP Roy Halladay, the Phillies sent Lee to the Mariners for prospects. The Mariners were expected to contend in the West. But Lee missed April with an abdominal injury, and Seattle started 19-31. Still, Lee is 8-3 with a 2.34 ERA in 13 starts.

Earlier Friday, it appeared Lee was heading to the Yankees for three minor-leaguers, including C Jesus Montero, among the game's top prospects. reported that the deal fell apart when Seattle became concerned about the health of 2B David Adams, out with a sprained ankle. "I had a pretty good feeling it was going to happen (with the Yankees)," Lee said. "But it didn't, and I'm a Ranger."

Texas GM Jon Daniels has repeatedly said he had financial flexibility to make a deal but never was specific. A bankruptcy judge in May approved a multimillion-dollar loan from MLB to keep the team afloat during bankruptcy proceedings.

"I'd guess they'll be some unnamed sources, but I don't expect a lot of phone calls," Daniels said when asked if he anticipates any backlash.

Smoak is one of the game's top prospects. The switch-hitter is hitting .209 with eight homers and 34 RBIs. Seattle also obtained RHP Blake Beavan - 10-5 with a 2.78 ERA at Double A and considered the Rangers' top pitching prospect - RHP Josh Lueke and INF Matt Lawson.

PEAVY OFFICIALLY DONE: After consulting with doctors, White Sox RHP Jake Peavy decided to have season-ending surgery on a detached right shoulder muscle. The 2007 NL Cy Young winner, 29, who was hurt while throwing a pitch Wednesday, said his career is not in jeopardy.

LATE SCRATCHES: Braves 3B Chipper Jones (back spasms), Phillies 2B Wilson Valdez (sore left wrist) and Reds 3B Scott Rolen (sore back) are day to day.

BREWERS: OF Geoff Jenkins, whose 212 homers are second in team history to Robin Yount's 251, signed a contract worth $1 and retired. Jenkins, 35, played for the Brewers from 1998-2007, then was part of the Phillies' World Series team in 2008. He has been out of the game since. In 11 seasons, he hit .275 with 221 homers.

TWINS: 1B Justin Morneau missed his second game because of a concussion and remains day to day.