The Royals get right-handed prospect Leo Nunez for Santiago but must also pay about $1 million of Santiago's $2.15 million salary in the second season of his two-year contract.
"We've been looking for a veteran catcher, someone who can catch about 100 games," Pirates general manager Dave Littlefield said. "We wanted to get someone with experience who could handle a majority of the load."
The deal with Pittsburgh was first discussed during last weekend's winter meetings in Anaheim, Calif., but wasn't completed until Santiago took a physical in Pittsburgh this week.
The Pirates were initially interested in dealing for Rockies catcher Charles Johnson, but he wanted a second year tacked onto his contract and the two sides could not work out terms.
Santiago, a five-time All-Star and three-time Gold Glove winner, hit .274 with six homers and 23 RBI in 49 games in 2004 but didn't play after fracturing his left hand June 18 against Philadelphia.
The right handed-hitting Santiago is seventh in major-league history with 1,911 games caught and will pass Al Lopez and Jim Sundberg if he catches at least 18 more games.
Trading Kendall, who regularly leads the majors in games caught, left backup Humberto Cota as the only Pittsburgh catcher with more than minimal major-league experience. Cota, who has only 108 career at-bats, is expected to start 65 to 70 games.
"Frankly, the thought of it is we like Cota and the better he plays, he'll play even more," Littlefield said. "Benito Santiago continues to be a solid guy out there and, in a limited market, he comes at the right price."
With more dollars to shop with than in recent winters, the Pirates are looking for an affordable starting pitcher and an additional hitter with some power after the Dec. 20 contract tender deadline.
Pittsburgh will be Santiago's ninth team since he broke in with San Diego in 1986. He has also played for the Marlins, Reds, Phillies, Blue Jays, Cubs, Giants and Royals, hitting .263 in 1,972 games with 217 homers and 920 RBI.
Santiago's name surfaced last year in the federal case involving the Bay Area Laboratory Co-operative, which is being investigated for distributing steroids. Among the players known to have testified before a federal grand jury were Santiago, Gary Sheffield, Jason Giambi, Jeremy Giambi, Armando Rios and Bobby Estalella.
Nunez, 21, was 10-4 with a 3.06 ERA and three complete games for Class A Hickory in 2004 and was fifth among South Atlantic League
pitchers with 140 strikeouts.
Marrero, 30, hit .250 with 10 homers and 40 RBI while splitting time in left field last season with Braves rookie Charles Thomas. Before that, Marrero spent seven seasons with St. Louis.
Vasquez, 26, made his major-league debut last season, giving up three runs in 3 1-3 innings in two games. He spent most of the season with Double-A Wichita, going 4-5 with a 4.68 ERA and 18 saves.
The Royals felt Santiago was expendable because they plan to start John Buck, with 34-year-old Albert Castillo as his backup. Buck, 24, hit .235 with 12 homers and 30 RBI in 71 games last season, while Castillo hit .270 in 29 games.