Atlanta-based Norfolk Southern confirmed Thursday it is in “advanced discussions regarding a potential business combination” with another railroad company, Union Pacific.
The announcement follows multiple media reports of the possible merger last week.
The combination of Norfolk Southern’s largely Eastern rail network with Union Pacific’s largely Midwest and Western network could create the largest railroad in the U.S. and have massive implications across the Class 1 freight railroad industry.
Union Pacific — which has a market value more than double Norfolk Southern’s — is headquartered in Omaha, Nebraska.
But securing federal approval for a railroad merger is no easy task.
The process could take more than a year, including seeking approval from the federal Surface Transportation Board, a five-member panel that is in charge of the economic regulation of freight rail.
“There can be no assurances as to whether an agreement for a transaction will be reached or as to the terms of any such transaction,” the companies said Thursday.
On a call with investors Thursday, Union Pacific CEO Jim Vena declined to discuss further detail of the possible deal.
“You never negotiate publicly,” he said.
“It’s advanced negotiations, which is good, but that’s it. That’s as far as I’m going to say.”
In 2018, Norfolk Southern announced it would move its corporate headquarters to Atlanta.
It opened its current $575 million headquarters building in Midtown in 2021, where it employs more than 3,000 people.
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