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I was wondering if there is any mention in Tolkien's Legendarium that Sauron knew about the prophecy that Smaug would be killed and that the Dwarves would then reclaim Erebor. If so, I was thinking perhaps this may be the reason why Sauron never bothered to travel to the Lonely Mountain to ask Smaug to join him.

Was Sauron aware of the prophecy that Smaug would be killed and that the Dwarves would reclaim Erebor?

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    Probably worth noting that in the book the song isn't a prophecy, it's just an ordinary song. The prophecy bit is Peter Jackson adding some fantasy style drama. So you're likely looking for an answer based specifically on the movie universe - but I wouldn't count on Peter Jackson going too deep with it. For him it's mainly about what's on screen.
    – Misha R
    Commented Apr 2, 2020 at 6:19
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    The Hobbit had references to a prophecy, though it was treated as something the Lake-town men said as wishful thinking, rather than something with the same weight as the prophecy about how the Witch-King would meet his end.
    – chepner
    Commented Apr 2, 2020 at 22:18
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    @chepner I did a search for "prophe" on the The Hobbit. The series of letters appears 4 times: 1. As the dragon flies towards the city, the text somewhat vaguely says "not the most foolish doubted that the prophecies had gone rather wrong." 2. A reference to people being sick of Bard prophesying floods and poisoned fish all the time. 3. Twice in the end, where Gandalf tells Bilbo that he shouldn't believe in prophecies less just because he had a hand in them. There is never a reference to which prophecies said what, who said them, how real they were, or what the song had to do with them.
    – Misha R
    Commented Apr 3, 2020 at 0:12
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    @MishaR That's consistent with what I was thinking, if not how I stated it :)
    – chepner
    Commented Apr 3, 2020 at 0:15

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What you seem to be calling a "prophecy" is not much more than an old song of Lake-town. While it does talk of the return of Thror to his realm under the Mountain, it is not necessarily prophesying a return nor is it held as such. It was, however, remembered by the people of Lake-town and believed much more so than The Master.

Some began to sing snatches of old songs concerning the return of the King under the Mountain; that it was Thror’s grandson not Thror himself that had come back did not bother them at all.
The Hobbit, Chapter X: A Warm Welcome

The entirety of the song is as follows:

“The King beneath the mountains,
    The King of carven stone,
The lord of silver fountains
    Shall come into his own!

His crown shall be upholden,
    His harp shall be restrung,
His halls shall echo golden
    To songs of yore re-sung.

The woods shall wave on mountains
    And grass beneath the sun;
His wealth shall flow in fountains
    And the rivers golden run.

The streams shall run in gladness,
    The lakes shall shine and burn,
All sorrow fail and sadness
    At the Mountain-king’s return!” ibid.

The text does however go on to suggests some newer songs had been written about the death of the dragon and the return of wealth:

Some of the songs were old ones; but some of them were quite new and spoke confidently of the sudden death of the dragon and of cargoes of rich presents coming down the river to Lake-town.
ibid.

These newer song were inspired by The Master and were not highly thought of by the Dwarves. They had, of course, brought Bilbo along as a burglar for some reason.

These were inspired largely by the Master and they did not particularly please the dwarves...
ibid.

Did Sauron know?

One can only guess how much Sauron knew about such songs. He was located nearby at the time at Dol-Guldur, as such it's possible spies and other evil creatures had overheard the songs/talk of the people of Lake-town. The death of Smaug was however very unlikely, King Thranduil is commended by the narrator for thinking the slaying of the dragon to be folly. As such the songs wouldn't have affected Sauron's "recruitment" of Smaug; if he had indeed intended to, at some point, recruit Smaug.

“But I expect they will all come to a bad end, and serve them right!” He (Thranduil) at any rate did not believe in dwarves fighting and killing dragons like Smaug, and he strongly suspected attempted burglary or something like it — which shows he was a wise elf and wiser than the men of the town.
ibid.

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