NBA coaching sources told ESPN.com on Friday that the former Dallas Mavericks coach was offered a five-year contract by the Grizzlies to replace Marc Iavaroni, who was fired late Thursday after 1½ seasons in Memphis.
Johnson, though, elected to pass on an in-season comeback, preferring to remain in his role as a first-year studio analyst for ESPN.
"I've said all along [that] at the right time and in the right situation, I will coach again," Johnson said Friday. "I am enjoying my time at ESPN and with my family. I think an awful lot of [Grizzlies owner] Michael Heisley and [general manager] Chris Wallace. I wish the Grizzlies the very best."
The Grizzlies on Friday formally announced Iavaroni's dismissal with the team mired at 11-30 after a 2-15 skid. Assistant coach Johnny Davis has been named interim coach going into Memphis' game Friday at New York, with sources close to the situation confirming to ESPN.com that former Grizzlies coach Lionel Hollins soon will be introduced as Iavaroni's successor, possibly as early as Sunday.
Yet it's not surprising to hear that Johnson was the Grizzlies' first choice given what sources describe as Heisley's strong desire to hire an experienced coach to lead and mold a young team that has started three rookies -- O.J. Mayo, Marc Gasol and Darrell Arthur -- in 25 of its 41 games this season.
Johnson, 43, certainly fits Heisley's profile, having posted a 194-70 record in four seasons with the Mavericks for a winning percentage of .735. Before his dismissal in May after two straight first-round playoff exits, Johnson took Dallas to the NBA Finals for the first time in the club's history in 2006.
Johnson also earned NBA Coach of the Year honors that season and followed up the trip to the Finals with a 67-15 season in 2006-07, before his tenure with the Mavs began to unravel with a first-round loss to the eighth-seeded Golden State Warriors and former Dallas coach Don Nelson.
The Memphis Commercial Appeal reported on its Web site early Friday that Hollins, now an assistant with the Milwaukee Bucks, will be hired as Iavaroni's replacement and be joined on the Grizzlies' bench by recently fired Philadelphia 76ers coach Maurice Cheeks.
Bucks general manager John Hammond told The Associated Press that while he couldn't confirm Hollins' plans, the team was thankful for his service.
"This looks like a great opportunity for Lionel," Hammond said from Atlanta, where the Bucks played the Hawks on Friday night. "We support him and wish him nothing but the best."
Hollins, 55, posted an 18-42 record as the Grizzlies' interim coach in Vancouver during the 1999-2000 season, replacing Brian Hill following a 4-18 start. Hollins also went 0-4 as the interim coach in Memphis between Hubie Brown and Mike Fratello during the 2004-05 season.
Iavaroni began the season on numerous hot-seat lists after Memphis went 22-60 in 2007-08. But the former Phoenix, Miami and Cleveland assistant appeared to be safe, at least through the end of this season, when he survived the early rash of firings around the league that claimed six coaches in a span of 23 days.
Heisley even took the step of giving Iavaroni what was generally perceived to be more than a pedestrian "vote of confidence" in early December, telling the Commercial Appeal: "He's my coach and I'm behind him 100 percent. I'm not going to evaluate him now. Marc is not under the gun."
The Grizzlies, though, have been increasingly uncompetitive, toting a seven-game losing streak into Friday's visit to Madison Square Garden after initially playing to some fairly positive reviews, thanks to an 8-8 start at home and the strong introduction made by Mayo.
Sources told ESPN.com on Friday that Iavaroni's tense relationship with forward Rudy Gay was another factor that, in the Grizzlies' view, made a coaching change unavoidable.
An increasingly and openly negative atmosphere around the team, sources say, appears to have changed Heisley's urgency in terms of evaluating his coach. Without naming Iavaroni, multiple players were highly critical of the team's strategy, development and identity in Sunday's editions of the Commercial Appeal.
"We don't have an identity," Gasol told the newspaper. "We don't have one. We run around like chickens with our heads cut off. Youth can be a good thing, but we use it as an excuse.
"We're always making excuses. We make excuses to the referees and to our teammates. We make excuses in practice. That's all some people want to do is make excuses. You're never going to get anywhere like that."
Gay was even more direct with his criticism, saying: "I know the things we're working on [haven't] worked. We ain't got no chemistry."
Iavaroni's supporters would counter that he had little chance to succeed with a group so young that Gay, in his third season, ranks as a veteran. The Grizzlies embarked on a full-fledged youth movement after trading Pau Gasol to the Los Angeles Lakers on Feb. 1, 2008, in a deal that was criticized throughout the league.
The Grizzlies are the seventh team to fire their coach this season, which is two firings shy of tying the league's single-season record of nine in the 2004-05 season.
The first six firings all took place before Dec. 25, doubling the league's previous single-season record for pre-Christmas coaching changes. Oklahoma City's P.J. Carlesimo (1-12 on Nov. 22); Washington's Eddie Jordan (1-10 on Nov. 24); Toronto's Sam Mitchell (8-9 on Dec. 3); Minnesota's Randy Wittman (4-15 on Dec. 8); Philadelphia's Maurice Cheeks (9-14 on Dec. 13); and Sacramento's Reggie Theus (6-18 on Dec. 15) were all fired after eight other teams made offseason coaching changes.
Johnson was fired by Dallas just one season into a lucrative reworked contract that will pay him an estimated $4 million this season and in each of the next two seasons unless he takes a head-coaching job elsewhere.
Marc Stein is a senior NBA writer for ESPN.com. The Associated Press contributed to this story.