NRG Energy Inc. has entered into an agreement to acquire Vivint Smart Home Inc. in an all-cash transaction valued at $2.8 billion.
It is an interesting deal considering NRG Energy is a dealer of electricity and natural gas in the U.S. and Canada and Vivint is a smart home device maker.
According to NRG, the deal will accelerate its consumer-focused growth strategy to create home services fueled by leading brands. NRG said it has adopted a strategy to become a provider of services for homes and businesses including those based on consumer trends.
Vivint Smart Home is one of the largest smart home vendors specializing in home security but also has a deep range of doorbell cameras, smart locks, smart thermostats, smart lighting, garage door controls and indoor and outdoor cameras.
Why it matters
Acquisitions are not new in the smart home market. They happen quite frequently in fact. This was after a period of major consolidation in 2019 and 2020 where companies were buying up smaller firms to complete solutions so homeowners could have an all-in-one solution that would be specially tailored to fit their needs.
The most interesting aspect to the deal is that an energy vendor wants to enter into the smart home market. NRG Energy said it sees the sector as a potential opportunity to expand not just in revenue but in its reliance to homeowners with intelligent automated devices.
With Vivint’s all-in-one services as well as its portfolio of devices, NRG sees this as a good way to expand its reach into the overall home beyond just electricity and gas.
As green energy becomes more important to government regulations and consumers, energy vendors may begin to transition to other services to make up for the lack of opportunities in the traditional energy market.