(Reuters) - Ace pitcher CC Sabathia has decided to stay under the Broadway bright lights in New York and agreed to a contract extension with the Yankees on Monday.

The 31-year-old Sabathia had earlier made the announcement on his Twitter account before the team confirmed that the big left-hander would in fact be returning.

"I'll be coming back in 2012. I want to thank (team owners) the Steinbrenner family for making that happen."

Sabathia, who had until midnight on Monday to opt out of his current deal, has agreed to a $25 million, one-year contract extension that includes a $5 million buyout.

Sabathia signed a seven-year, $161 million deal with the Yankees before the 2009 season, the largest contract at the time for a pitcher in Major League Baseball.

A five-time All-Star who won the Cy Young Award in 2007, Sabathia has recorded 176 wins and a 3.51 earned run average in 11 seasons with the Cleveland Indians, Milwaukee Brewers and Yankees.

(Writing by Mark Lamport-Stokes in Los Angeles; Editing by Nick Mulvenney)