The $12 per share deal is at a premium of 33.5% to Vivint’s closing stock price on Monday. Houston, Texas-based NRG will also take on $2.4 billion of debt as part of the deal.
Vivint’s shares rose nearly 32% in premarket trading and were just shy of the offer price, while those of NRG were down 4.5% at $39.
Vivint makes a range of home security products and hubs that help in controlling other automation gadgets, such as Amazon Echo and Google Home, through a central touchscreen panel.
Together, the companies will serve over 7.4 million customers across North America, they said in a statement.
The buyout has been unanimously approved by the boards of both the companies and is expected to close in the first quarter of next year.
Provo, Utah-based Vivint was bought by Blackstone for over $2 billion in 2012. Vivint then became publicly listed through a reverse merger with Mosaic Acquisition, a special-purpose acquisition company of SoftBank Corp.