Atlantic Union-Sandy Spring merger reshapes Mid-Atlantic banking with $1.3bn all-stock deal

Atlantic Union Bankshares Corporation has formally completed its acquisition of Sandy Spring Bancorp, Inc., a strategic transaction that significantly alters the regional banking landscape across the Mid-Atlantic corridor. The $1.3 billion all-stock deal, finalised on April 1, 2025, establishes the combined company as the largest regional banking franchise headquartered in the lower Mid-Atlantic. With a pro forma asset base approaching $39 billion, the merger creates a consolidated platform that stretches across key growth markets from Baltimore through Washington D.C. into Virginia and beyond.

This merger between Atlantic Union Bankshares and Sandy Spring Bancorp had originally been announced in October 2024 and marks a substantial milestone in the evolution of regional banking, particularly as mid-sized institutions seek scale and stability amid increased regulatory scrutiny and shifting economic conditions. The final transaction value was determined based on Atlantic Union’s closing share price of $31.14 on March 31, 2025. Under the terms of the agreement, Sandy Spring shareholders received 0.900 shares of Atlantic Union stock for each Sandy Spring share, with fractional shares settled in cash.

How does the Sandy Spring merger strengthen Atlantic Union’s regional position?

With the merger now complete, Atlantic Union Bankshares Corporation has significantly expanded its reach throughout the Mid-Atlantic, bringing in over 50 new branches and a substantial boost to its wealth management operations. As of December 31, 2024, on a pro forma basis before merger-related adjustments, the combined entity holds approximately $38.7 billion in assets, $32.1 billion in deposits, and $30 billion in loans held for investment. These figures underscore the deal’s material impact, not only on Atlantic Union’s financials but also on its strategic positioning in a competitive banking environment.

The Sandy Spring acquisition is more than just a geographic expansion. It offers operational and strategic synergies that could unlock long-term value for shareholders. The integration of Sandy Spring Bank into Atlantic Union Bank also contributes to a more diverse and resilient portfolio, particularly in high-value markets such as Northern Virginia and suburban Maryland—areas that are home to affluent customers, dynamic commercial activity, and strong demand for banking and wealth management services.

According to Atlantic Union President and CEO John C. Asbury, the deal represents the culmination of a strategic roadmap that began in 2018. He described the merger as a unification of the top regional banks in Virginia and Maryland, positioning the company as a major force in Mid-Atlantic banking. Asbury stated that this newly combined institution offers something that has never existed before in the region—a comprehensive, community-focused banking franchise with Virginia as its operational linchpin and scalable potential across the Southeastern United States.

Why is the Sandy Spring acquisition considered a blueprint for regional banking consolidation?

In an industry increasingly dominated by large national players and fintech disruptors, regional banks have faced pressure to scale up or risk being outcompeted. The Sandy Spring merger with Atlantic Union Bankshares Corporation is widely seen as a strategic consolidation that provides the scale and efficiency needed to remain competitive while retaining community banking values. By combining resources, the two banks are now better positioned to invest in digital capabilities, broaden their commercial offerings, and weather potential economic headwinds.

The combined wealth management assets, now exceeding $13 billion, mark a near doubling of Atlantic Union’s previous portfolio in this segment. This expansion allows the institution to serve more affluent clients while generating fee-based revenue streams that are less sensitive to interest rate cycles. In addition to the balance sheet gains, the deal brings expanded human capital, local expertise, and established client relationships—all of which are valuable intangibles in the increasingly service-oriented banking environment.

From a regulatory and risk management standpoint, the enlarged scale of Atlantic Union may improve its ability to absorb compliance costs and adapt to future regulatory changes. The banking sector continues to face pressure from heightened oversight, capital requirements, and technology-driven transformation. By growing through acquisition, Atlantic Union has gained both operational leverage and strategic optionality.

How has the market reacted to Atlantic Union’s post-merger position?

Following the merger’s close, Atlantic Union Bankshares Corporation’s stock traded at $30.41 on April 2, 2025, reflecting modest intraday gains. The stability of AUB’s share price during the days leading up to and following the transaction indicates a largely positive market response. Investors appear to support the strategic rationale behind the Sandy Spring acquisition, viewing it as a long-term value driver rather than a risk-heavy expansion.

While the original transaction, announced in October 2024, had been estimated at $1.6 billion, the final valuation dropped to $1.3 billion due to market fluctuations. Despite this downward revision, investor sentiment has remained resilient. Analysts point to the added scale, deeper market penetration, and enhanced non-interest income streams as key advantages. Hovde Group, which had previously reduced its price target for AUB from $42 to $34 in 2023, has maintained a neutral position, citing the need for further clarity on integration progress.

The company’s upcoming Q1 2025 earnings release, scheduled for April 24, is expected to provide critical insight into initial post-merger performance and synergies. Until then, market experts largely recommend a ‘Hold’ position on AUB shares, allowing investors time to assess the execution of integration plans and early signs of earnings accretion.

Who is leading Atlantic Union through this transformative phase?

In addition to the financial integration, the merger has brought notable changes to corporate governance. Three Sandy Spring directors—Daniel J. Schrider, Mona Abutaleb Stephenson, and Mark C. Micklem—have been appointed to the boards of both Atlantic Union Bankshares Corporation and Atlantic Union Bank. Their addition brings valuable continuity, insight into legacy operations, and a broader diversity of perspectives to the leadership table.

Daniel Schrider, previously the Chief Executive Officer of Sandy Spring Bancorp, expressed optimism about the combined company’s trajectory. He stated that the merger was a forward-looking decision designed to maximise opportunities for employees and clients alike. According to Schrider, the cultural alignment between both institutions will help ensure that customers continue receiving high-touch service, even as the bank grows in size and sophistication.

Governance alignment is often cited as a key success factor in large bank mergers. The inclusion of Sandy Spring’s senior leadership in Atlantic Union’s decision-making structure is likely to facilitate smoother operational integration, while also preserving the relationship-based service model that both banks have historically valued.

What’s next for Atlantic Union in the Mid-Atlantic market?

With regulatory and shareholder approvals behind it, and legal and financial advisory services from firms including Morgan Stanley, Davis Polk & Wardwell LLP, Keefe, Bruyette & Woods, and Kilpatrick Townsend & Stockton LLP, Atlantic Union is now fully focused on operational integration. Over the coming quarters, management will aim to realise cost synergies, optimise the branch network, and unify digital banking platforms across legacy systems.

Experts believe the Sandy Spring merger offers a model for future regional consolidation—particularly in areas where market saturation and customer expectations demand both scale and personalisation. The Mid-Atlantic region remains one of the most competitive and economically diverse banking environments in the country. With expanded capacity, enhanced technology infrastructure, and a wider talent pool, Atlantic Union is now better positioned to meet the evolving needs of consumers and businesses alike.

As the company prepares for its next phase of growth, its ability to deliver on the promise of long-term shareholder value, customer satisfaction, and operational excellence will be closely watched by analysts and investors. If successful, this merger could not only transform Atlantic Union into a dominant regional player but also signal a new era for community-oriented banks seeking sustainable growth through strategic alignment.