It has been a big money week for baseball's most sought after players as the off season signings continue to set records.
The person spoke on condition of anonymity because the agreement had not been announced.
Cole, the biggest prize of the free agent market, surpassed the $245 million, seven-year contract Stephen Strasburg finalized with the Washington Nationals earlier in the week.
Agent Scott Boras negotiated both deals.
Cole was drafted by the Yankees in the first round out of high school but chose to go to UCLA, then was drafted by Pittsburgh. Traded after the 2017 season, he transformed his career in two seasons with the Houston Astros.
He went 20-5 with a 2.50 ERA last season as the Astros reached the World Series, finishing second to teammate Justin Verlander in AL Cy Young Award balloting.
The Associated Press contributed to this article.