ServiceMaster stockholders will get $15.625 in cash for each outstanding share, a premium of about 16 percent over Friday's closing price of $13.47 on the New York Stock Exchange.
Clayton will also assume about $800 million in debt, said ServiceMaster spokesman Steve Bono.
ServiceMaster stock was up on the news. The company has 303 million shares outstanding.
On completion of the transaction, Clayton's operating partner, George Tamke, will become chairman of the ServiceMaster board. Patrick Spainhour will remain chief executive.
ServiceMaster's businesses also include American Home Shield warranties and the Merry Maids cleaning service, as well as drain cleaning and furniture repair operations.
The company, which was founded in 1929, competes with Scotts Miracle-Gro Co.'s
Shareholders will vote on the deal at a special meeting during the second quarter.