Union Pacific Corporation and Norfolk Southern Corporation announced a historic merger on Tuesday, creating America’s first transcontinental railroad network. The $85 billion deal will link over 50,000 route miles from coast to coast.
As part of the agreement, Union Pacific will acquire Norfolk Southern for $320 per share in a cash-and-stock deal. This represents a 25% premium over Norfolk Southern’s current stock price and values the combined company at more than $250 billion.
The merger is expected to be one of the largest rail mergers in US history and mark the first time a single company will control rail shipments from the East Coast to the West Coast. The companies believe this will reshape the US logistics landscape, revitalize US manufacturing, drive economic growth, and create jobs.
The combined railroad will also compete more effectively with Canadian railroads, aiming to reclaim US freight volume and bring back American jobs. With the goal of improving efficiency and reducing costs, the new company plans to streamline services, eliminate interchange delays, and expand intermodal services.
According to Union Pacific CEO Jim Vena, “This transaction is the next step in advancing the industry.” The merger is expected to deliver faster, more comprehensive freight service to US shippers, decrease highway congestion, and reduce wear-and-tear on taxpayer-funded roads.
Source: https://www.foxbusiness.com/lifestyle/union-pacific-norfolk-southern-merge-creating-first-us-transcontinental-railroad