The Mariners announced the move Wednesday, along with the decision that backup infielder Munenori Kawasaki has been released. Seattle's 40-man roster stands at 39.
Olivo concluded his second season with the Mariners playing in 87 games and hit .222 with 12 home runs and 29 RBIs. But his time behind the plate was severely reduced with young prospect Jesus Montero and John Jaso on the roster. Olivo had just a .239 on-base percentage in 2012.
The club option for Olivo would have been worth $3.25 million for the 2013 season. His buyout was $500,000.
Kawasaki played in 61 games and was known more for his excitable attitude than his play on the field. Kawasaki hit just .192 during limited time in his first major league season after a decade playing in Japan.