He was bad last year, and 34 year olds with multiple long playoff runs don't typically bounce back unless they're Lebron.
I doubt he had many offers approaching what the Kings offered, so it must have been influenced by Luke. Every coach loves bringing in at least one of "their" guys.
It's just one year, but if they were patient maybe they could've eventually taken back a bad contract with a pick. Now they're just stuck with a zero upside bad contract. Shump without the good vibes.