Stephen A. Smith says the young Heat team can benefit from Andre Iguodala's veteran presence going into the second half of the season. (1:40)

The Miami Heat have traded Dion Waiters, Justise Winslow and James Johnson to the Memphis Grizzlies for Andre Iguodala, Solomon Hill and Jae Crowder, the teams announced Thursday.

The Minnesota Timberwolves later joined the deal, acquiring Johnson from the Grizzlies in exchange for center Gorgui Dieng.

Along with the trade, Iguodala, the 2015 NBA Finals MVP, has agreed to a two-year, $30 million extension with Miami, sources told ESPN's Adrian Wojnarowski. The extension includes a team option for the 2021-22 season.

"Today is a very good day because we think the acquisition of Andre, Jae and Solomon will help us with our versatility and create a more balanced roster," Heat president Pat Riley said in a statement announcing the deal. "Today is also a sad day because we lose three very good players who have been part of our family. We wish Justise, James and Dion nothing but the best in the future."

Iguodala, who did not play for the Grizzlies after joining them in an offseason trade, has also suited up for Philadelphia, Denver and Golden State. A two-time All-Defensive team selection, he has averaged 12.1 points in 1,108 career games, plus is a veteran of 145 playoff contests and was with the Warriors for all five of their NBA Finals runs over the past half-decade.

"He won, what, three championship rings?" Heat guard Goran Dragic said. "Happy to have him. Can't wait to pick his brain. He's going to do great things for us."

The Grizzlies made another move Thursday, acquiring Jordan Bell from the Houston Rockets in exchange for Bruno Caboclo. The teams are also exchanging 2023 second-round picks, a source told Wojnarowski, with Memphis having the right to send the least favorable pick (via Dallas and Miami) as long as it's not No. 31 or 32.

In an interview with The Undefeated's Marc J. Spears on Wednesday night, Iguodala said he will take a physical for the Heat on Friday and will need "a couple of days" before he's ready to play.

Iguodala also said he is "really excited" to be joining the Heat and playing with Jimmy Butler and center Bam Adebayo, a first-time All-Star this season.

"Jimmy Butler ... he's looked at as different but [is] very well-respected in terms of the passion and the hard work that he brings to the game," Iguodala told The Undefeated. "I feel like his temperament and values that he has really resonates with the Miami Heat. They're very well aligned. I think he's brought out the best in those young guys."

Winslow has been with the Heat for five seasons, missing most of his second season with a shoulder injury and playing only 11 games this season due to back problems. He is averaging 11.3 points, 6.6 rebounds and 4.0 assists.

Waiters joins the Grizzlies after playing in only three games for the Heat following three suspensions this season, including one for taking cannabis-infused gummies on the team plane and needing emergency medical attention when that flight landed in Los Angeles.

Johnson, who is averaging 5.7 points and 2.9 rebounds in 18 games this season, is returning to Memphis after spending 2013-14 with the team. He was with Miami for parts of four seasons.

Crowder is averaging 9.9 points and 6.2 rebounds per game for the Grizzlies, with Hill averaging 5.7 points and 3.0 rebounds per game.

Dieng, a 2013 first-round pick, is averaging 7.4 points and 5.6 rebounds per game for the Timberwolves this season.

Bell is averaging 3.3 points and 2.7 rebounds for the Rockets this season, while Caboclo averaged 2.8 points and 2.0 rebounds for the Grizzlies.

Miami, Memphis and Oklahoma City had been working on a three-team trade that would have landed the Heat both Iguodala and Danilo Gallinari, but the Heat and Thunder were not able to reach an agreement, league sources told Wojnarowski.

The Associated Press contributed to this report.