Two league sources tell Y! Sports the Kings are unsure whether they will keep McGrady or expand the trade to three teams and send him to the New York Knicks.
McGrady's agent, Arn Tellem, had worked diligently with the Rockets to broker a trade for T-Mac to the Knicks, and sources say he's now determined to get him out of Sacramento. Tellem also represents the Kings' prized rookie, Tyreke Evans.
A league official involved in this deal rates the possibility of New York general manager Donnie Walsh cutting a deal for T-Mac as "possible."
"But I'm not sure it's likely yet," the official said.
During his conversations with the Rockets, Walsh had discussed a package that included Larry Hughes, Jordan Hill, Jared Jeffries and possible draft picks. Trading Hill and Jeffries for an expiring contract or contracts would allow the Knicks to clear enough salary-cap space to potentially sign two star free agents this summer.
Martin told Y! Sports’ Marc Spears he will miss Sacramento, but was appreciative for the chance to play for a potential playoff team.
"It goes both ways,” Martin said by phone shortly after the trade. “Sacramento gave me an opportunity. I was a late first-round pick. I could have been playing overseas. I assumed they still loved me. I was the ‘Golden Child’ – that's what Corliss Williamson used to say. I guess that's the sad part.
“But it was time. I used to be the young guy playing with old guys. Now I'm the old guy playing with young guys. Let the young guys develop. I appreciate them letting me go to a playoff-caliber team at this time of my career."
The Kings pulled Martin aside at halftime and told him he was being traded. Martin will be reunited with former Sacramento coach Rick Adelman.
"At halftime coach [Paul Westphal] said, 'There is a trade involving you. You are the piece," Martin said. "My first question was, 'Who is the team?' 'Houston.' I was good with it. It's time to move on.
"I'm definitely excited for a new opportunity with my old coach. That's the funny part."
If T-Mac stays with the Kings and ends up with a buyout, he hopes to join a playoff contender. A source close to him says he would like to sign with the Los Angeles Lakers or Cleveland Cavaliers.
While there's no evidence the Lakers have interest, Cavs GM Danny Ferry had done a little research on T-Mac during his exile from the Rockets. Still, the Cavaliers traded for Antawn Jamison on Wednesday and it's extremely unclear whether they would want to risk disrupting their chemistry to bring on another former All-Star – one who has spent the season recovering from microfracture knee surgery.
McGrady has played in only six games, appearing for fewer than eight minutes in each, before the Rockets gave him a leave in December to work out in Chicago.
The Knicks had been in serious negotiations for McGrady since All-Star weekend, but those talks stalled over Houston's demands for draft picks and the protection for the picks. The Rockets, who also had been in negotiations with the Chicago Bulls, then engaged the Kings in a three-way dialogue.
The Bulls were trying to get McGrady and his $23 million expiring contract, but ended up making a smaller trade – sending John Salmons to the Milwaukee Bucks – that changed those conversations.
Rockets GM Daryl Morey has long been enamored with Martin, and kept pushing for a deal between the two teams. Morey knew Martin had become unhappy in Sacramento, sources said, and that the Kings shooting guard was struggling to adjust playing alongside rookie point guard Tyreke Evans. Martin didn't feel like his talents were compatible with Evans, and struggled to defer to him.
The Mavericks also had serious interest in Martin, but abandoned those talks to complete a trade with the Washington Wizards for Caron Butler and Brendon Haywood on Saturday.
Morey didn't have an easy time parting with Landry, a rugged, undersized forward who had come to personify the grit of these Rockets. Yet, the chance to secure a young, talented scorer for his offensively challenged roster was too much to pass up.
Martin's addition comes with a price: He will make $46 million over the next three seasons. Martin, 27, also has missed at least 20 games in each of the past three seasons, including 32 this season because of a broken wrist.