Cotton Fitzsimmons, who led the Kansas City Kings, to a first-place finish in the Midwest Division was named NBA coach of the year yesterday.

The Kings, who finished last in their division with a 31-51 record in 1977-78, climbed to 48-34 under Fitzsimmons this season, edging Denver for the division title by winnink their last five regular-season games.

Fitzsimmons received 37 1/2 votes from a panel of 66 media representatives from the 22 league cities. San Diego's Gene Shue was second with 11 votes while Hubie Brown of Atlanta and Lenny Wilkens of Seattle tied for third with 5 1/2 votes each.

Elsewhere on the coaching front the Denver Nuggets' acting coach, Donnie Walsh, signed a multiyear contract to continue in the job. . .fromer goalie Eddie Johnston will coach the Chicago Black Hawks, replacing Bob Pulford, who will be general manager.

A multimillionaire New York naval architect apparently will become the new owner of the Houston Astros and operator of the Astrodome and its adjacent entertainment and convention facilities.

John J. McMullen, who also is a limited partner in the New York Yankees, reportedly has offered between $15 million and $20 million for the package.

The National League, meeting in Chicago Wednesday, is expected to approve the sale to McMullen by the Astrodomain Corp., which is owned by the Ford Motor Credit Co.

Astrodomain President W.E. Odom said the agreement provides for McMullen to purchase Astrodomain's stock in the Houston Sports Association.

Nadia Comaneci, described as "composed, confident and almost cocky," presented a near-perfect performance yesterday to win the European Women's Gymnastics Championship.

Romania's Olympic gold medalist won three of the four disciplines, losing only the balance beam competition. In second place was Romanian Emilia Eberle while the Soviet Union's Natalia Shaposhnikova finished third.

The University of North Carolina has won the Atlantic Coast Conference's Carmichael Cup, symbolic of overall athletic excellence in the league.North Carolina had 68 points followed by Clemson, 63 1/2, and Maryland, 58 1/2.

Testimony in the arbitration case involving Atlanta Brave slugger Bob Horner ended yesterday with a verdict expected within two weeks.

Horner was given a $200,000 bonus for signing with the club last June, plus a first-year contract worth $21,000. He says that made his annual income $221,000 and that the Braves therefore had to pay him at least 80 percent of that, or roughly $175,000.

The Braves say the bonus should not be considered part of his salary and subject to the 80 percent rule. Horner could be awarded $146,000 or $100,000 and ordered to remain with the Braves in either case. He could also be declared an unrestricted free agent.