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PROVO — Fortune 500 company NRG Energy Inc. has agreed to acquire Provo-based Vivint Smart Home Inc. for $2.8 billion, the companies announced on Tuesday.
Per the agreement, Houston-based NRG will pay $12 per share in cash, and will assume an additional $2.4 billion in debt. The total value of $5.2 billion is a 33% premium on Vivint's closing share price on Monday, according to NRG. Vivint — which was acquired in 2012 by private equity firm Blackstone in what was, at the time, the largest tech deal in Utah history — became a publicly traded company in 2020.
"We are pleased to announce a transaction that delivers immediate and compelling cash value to Vivint's stockholders while also presenting significant opportunities to drive our company's continued success in the years to come," Vivint Smart Home CEO David Bywater said in a statement.
"Our agreement with NRG is the culmination of our board's ongoing pursuit of maximizing value for Vivint stockholders and is a testament to the strength of the Vivint brand, capabilities and proven industry leadership," he continued. "We look forward to working with NRG to create exciting opportunities for Vivint as part of a larger platform. On behalf of our board and management team, I thank the hard-working Vivint employees for the significant role they have played in this important milestone."
Vivint was founded by Todd Pedersen and Keith Nellesen in 1999 as a home security company, and has since expanded its products to include smart home hardware and software. Vivint acquired the naming rights to the Utah Jazz home arena in Salt Lake City in 2015.
NRG's acquisition of Vivint and its nearly 2 million customers is part of the company's plan to expand its offering of "essential services for homes and businesses," Mauricio Gutierrez, president and CEO of NRG, said in a statement.
"The acquisition of Vivint is a transformational step in achieving our vision," he said. "Customers want simple, connected and customized experiences that provide peace of mind. Vivint's smart home technology strengthens our retail platform, improves our customer experience, and increases customer lifetime value."
The combined company will serve approximately 7.4 million customers in North America, according to NRG's statement.
NRG is involved in energy generation with a portfolio that includes natural gas, coal, oil, nuclear, wind and distributed solar generation. The company has 6 million retail customers in 10 states and the District of Columbia, as well as eight Canadian provinces.
The acquisition is expected to close in the first quarter of 2023, pending customary approval from the Federal Trade Commission and the U.S. Department of Justice Antitrust Division.
NRG plans to maintain a "significant presence in Utah" following the transaction, according to the statement.