Giants hold off on Lilly deal after reviewing medical history
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UPDATE (3:45 p.m.): The Giants have responded to news of a reported Lilly deal falling through:

SAN FRANCISCO – In what amounts to a low-risk tryout, the Giants are nearing an agreement with veteran left-hander Ted Lilly on a Triple-A contract.

I’m told the Giants haven’t announced the deal because it hasn’t been signed and is pending several details including a physical. But a source told Chris Cotillo of MLB Daily Dish, who first reported the deal, that Lilly would start for Triple-A Fresno Tuesday night.

Lilly, 37, was designated for assignment by the Dodgers on July 25 and released on Sunday, when no club claimed him off waivers. He made five starts this season and posted a 5.09 ERA and 1.61 WHIP in 23 innings, while walking 10. He has struggled to overcome a chronic neck issue.

The Dodgers owe Lilly the balance of his $13 million salary for this season, less a prorated amount of the major league minimum if and when the Giants bring him to the big leagues.

The Giants have a number of rotation options now that Ryan Vogelsong is bound to return from the DL on Friday; Barry Zito already has been relegated to a long relief role. But Lilly could provide another option to help the Giants ease the innings strain on their established starters, while providing depth to a Fresno rotation that has been thin all season.

It’s a good landing spot for Lilly, who grew up north of Fresno and attended Fresno City College. He’s long desired to play for the Giants.

The contract is believed to include a clause that would guarantee Lilly a spot on the major league roster after a certain date. The two sides were not discussing a contract that would last beyond this season.

Lilly is 130-113 with a 4.14 ERA over 15 major league seasons. He’s one of few active players who has worn a Montreal Expos jersey. He’s also played for the Yankees, A’s, Blue Jays and Cubs before joining the Dodgers midway through the 2010 season.

He’s thrown just 71.2 innings in the big leagues over the last two years.