FirstSun Capital and First Foundation Announce $785 Million Merger

FirstSun Capital Bancorp and First Foundation Inc. have announced a definitive agreement to merge in an all-stock transaction valued at approximately $785 million. Under the terms of the agreement, First Foundation shareholders will receive 0.16083 shares of FirstSun common stock for each share they own. Upon completion, FirstSun shareholders will own 59.5% of the combined entity, while First Foundation shareholders will hold 40.5%.

The merger is expected to close in the second quarter of 2026, pending regulatory and shareholder approvals. The combined institution will have approximately $17 billion in total assets and $6.8 billion in assets under management. This strategic move will expand FirstSun's presence into the Southern California market, adding 18 branches to its network.

Executive leadership will remain largely unchanged, with FirstSun's current executive chairman, CEO, and CFO retaining their positions. Tom Shafer, CEO of First Foundation, will serve as vice chairman of the combined company.

Financial advisors for the deal include Stephens Inc. for FirstSun and Keefe Bruyette & Woods for First Foundation.

This merger reflects a trend of consolidation among regional banks aiming to strengthen their balance sheets amid economic uncertainties.

The merger is projected to deliver over 30% accretion to FirstSun's 2027 estimated earnings per share, with a 3.3-year earn-back period on tangible book value dilution. Pro forma financial metrics for 2027 include a return on average assets of approximately 1.45% and a return on average tangible common equity of about 13.3%.

Following the announcement, First Foundation's shares increased by approximately 8%, while FirstSun's shares declined by about 4%.

This merger reflects a trend of consolidation among regional banks aiming to strengthen their balance sheets amid economic uncertainties. For instance, Nicolet Bankshares recently announced an $864 million stock acquisition of MidWestOne Financial Group.

The merger is expected to enhance banking services in the Southern California region, potentially leading to increased competition and improved offerings for consumers. However, consolidations can also result in branch closures and job redundancies, affecting local employment. The combined entity's strengthened financial position may contribute to greater economic stability in the regions it serves.

This strategic merger positions FirstSun Capital Bancorp and First Foundation Inc. to better serve their customers and communities, while also aiming to deliver enhanced value to shareholders.