(Bloomberg) -- Atlantic Union Bankshares Corp. agreed to buy rival Sandy Spring Bancorp for about $1.6 billion in stock, as consolidation picks up among small and midsize banks. 

Sandy Spring investors will receive 0.9 shares of Atlantic Union stock for each share they own, valuing Sandy Spring at about $34.93 per share, according to a statement Monday that confirmed an earlier Bloomberg News report. 

Mergers have been picking up in recent months among banks with less than $50 billion in assets, as those types of institutions struggle with tepid loan growth and anemic net interest margins, meaning the spread between what banks earn from loans and pay for deposits.

Atlantic Union and Sandy Spring have complementary branch-footprints in the mid-Atlantic region. The deal will give Atlantic 53 new branch locations and increase its wealth assets under management by more than $6.5 billion, according to the statement. 

“Atlantic Union will create a preeminent regional bank, with Virginia as its linchpin, that spans the lower mid-Atlantic into the Southeast and that is committed to the communities it serves,” John C. Asbury, chief executive officer of Atlantic Union, said in the statement. 

Morgan Stanley advised Atlantic Union on the deal, while Sandy Spring was advised by Keefe, Bruyette & Woods. 

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