Oct 21 (Reuters) - Atlantic Union Bankshares ( AUB )

will buy smaller rival Sandy Spring Bancorp ( SASR ) in an

all-stock deal worth $1.6 billion, as the regional lender looks

to bolster its presence in Northern Virginia and Maryland.

The combination will create the largest regional bank

headquartered in the lower Mid-Atlantic with $39.2 billion in

assets, the companies said on Monday.

The transaction is the latest in a string of $1 billion-plus

bank deals this year as consolidation among regional lenders

gathers pace to boost scale and shore up balance sheets to

better compete against bigger rivals.

Sandy Spring shareholders will receive 0.900 shares of

Atlantic Union for each held, valuing the lender at $34.93

apiece based on Atlantic's last close.

The offer represents a 7.1% premium to Sandy Spring's last

close. Its shares rose 3% in premarket trading.

The deal will also nearly double Atlantic Union's wealth

business by boosting assets under management by more than $6.5

billion.

Founded in 1868, Olney, Maryland-based Sandy Spring managed

$14.4 billion in assets, as of Sept. 30.

Three Sandy Spring executives, including CEO Dan Schrider,

will join Atlantic Union's board after the deal closes, which is

expected by the end of third quarter of 2025.

Separately in the day, Richmond, Virginia-based Atlantic

Union said it priced a public offering of nearly 9.9 million

shares at $35.50 per share to raise $350 million.

Morgan Stanley and Davis Polk advised Atlantic Union, while

Keefe, Bruyette & Woods and Kilpatrick Townsend & Stockton

advised Sandy Spring.