UP-NS Merger: Coast-to-Coast Rail Expansion in US – Key Facts

Introduction

Shareholders of Union Pacific (UP) and Norfolk Southern (NS) have approved the proposed merger between the two Class I railroads, a move toward creating what the companies describe as America’s first coast-to-coast transcontinental railway. The merger is expected to close by early 2027, pending Surface Transportation Board (STB) approval.

Main Content

Shareholder Approval

Union Pacific reported 99.5% of votes cast in favor of issuing new UP common shares in connection with the merger. The preliminary vote represented nearly 80% of all outstanding shares, with final results to be confirmed in a forthcoming SEC filing. Norfolk Southern shareholders also approved the deal with nearly 99% of votes cast in favor.

Executive Statements

“We appreciate our shareholders’ support in reaching this important milestone on our path to building America’s first coast-to-coast railroad,” said Jim Vena, Union Pacific CEO. “Our shareholders see the value and understand this merger will unlock new opportunities to enhance service, growth and innovation. We look forward to filing our application with the Surface Transportation Board (STB) and detailing how the transaction will provide seamless, single-line service across the country to improve transit times, safely increase reliability and strengthen the competitiveness of U.S rail.”

“The approval of our shareholders marks a key milestone in our journey to create America’s first coast-to-coast transcontinental railroad, combining complementary networks and capabilities to unlock a multiplier effect for benefits to all stakeholders,” said Mark George, President and CEO of Norfolk Southern. “The merger will preserve union jobs and improve safety while delivering faster, more reliable transit times.”

Merger Terms and Timeline

Under the agreed terms, NS shareholders will receive 1.0 UP share plus $88.82 in cash for each NS share. The companies expect the transaction to close by early 2027, subject to STB approval and customary closing conditions.

Competition Concerns and Regulatory Review

The merger has prompted public comment from another railway company, which raised concerns about future competitive conditions in the intermodal market. Union Pacific indicated that more than 300 intermodal lanes would not be closed where origins or destinations currently lie on specific routings, should the merger be approved.

The other railway company pointed to previous positions taken by Union Pacific during another merger, citing UP’s filings arguing for conditions to protect competitive gateways and warning that post-merger operators might divert interline traffic or increase rates in ways that reduce shipper choice. The proposed UP–NS merger will undergo a full STB regulatory review, including scrutiny of competitive impacts, service integration and public-interest considerations.

Conclusion

If approved, the combined network would connect East and West Coast gateways under a single Class I operator for the first time in U.S. history. The comments from the other railway company, however, signal that competitive safeguards and gateway conditions may become central elements of the STB’s review process.

Company Summary

Union Pacific (UP): A Class I railroad company.

Norfolk Southern (NS): A Class I railroad company.