ST KILDA'S veteran forward Aaron Hamill will announce his retirement this week, despite being contracted to play for the Saints in 2008.

Hamill, who did not play at senior level this year, is understood to have reached a financial settlement on the final year of his lucrative contract.

Hamill, who managed only 21 games in three seasons and was grounded this year by a chronic knee injury, was to be paid about $400,000 next year, having negotiated a four-year contract extension early in 2004. In effect, he was then given a new five-year deal.

The Saints have managed to strike a deal with Hamill over the last year of the contract, having brought forward some of next year's contract into this year's player payments, via the injury payments allowance.

So Hamill's retirement will save the club some salary cap room in 2008 and should allow them to acquire a player, although the club is still to re-sign key defender Matt Maguire.

Hamill went overseas on the weekend and left matters in the hands of his manager Ricky Nixon, who was forced to step in and act for the forward after his previous manager, David Allison, became a quadriplegic following a car accident. Allison, who had been living in Queensland, was the manager who negotiated Hamill's controversial exit from Carlton to St Kilda at the end of the 2000 season.

Hamill and Anthony Koutoufides were his best-known clients, the Blues having signed Koutoufides to a five-year, $5 million contract, still the richest in AFL history, in 2001.

Hamill left Carlton and signed with the Saints on a four-year deal worth about $2 million, and quickly became a favourite at Moorabbin for his aggressive style and leadership.

At his best, Hamill was a hard and athletic forward who played much taller than his 184 centimetres. He was noted for his defensive work in the forward line and was particularly damaging when flanked by capable key forwards such as Fraser Gehrig and Nick Riewoldt, and the youthful Lance Whitnall at Carlton.

Recent medical reports had indicated that Hamill would struggle to train properly for some weeks, prompting the decision to retire.

Hamill joined St Kilda at the same time as Gehrig crossed from West Coast and their signing by the new Rod Butterss administration stunned the football industry, happening, as it did, while the club was securing Malcolm Blight for his short-lived tenure as senior coach.

Hamill — drafted by Carlton from ACT club Tuggeranong at a bargain pick No. 79 in 1994, played 190 games in his career, booting 239 goals.