Union Pacific Corporation (NYSE: UNP) and Norfolk Southern Corporation (NYSE: NSC) have filed an application with the Surface Transportation Board (STB) seeking approval to combine the two railroads. The companies entered into a merger agreement on July 29, 2025, to create America's first transcontinental railroad.
The application includes a record-breaking 2,000 letters of support from stakeholders, and shareholders at both companies voted 99% in favor of the merger.
Key Metrics and Benefits of the Merger: The combined network will move freight more efficiently, eliminating an estimated 2,400 rail car and container handlings and 60,000 car-miles each day. The merger is expected to convert an estimated 2 million truckloads of freight from road to rail annually, reducing congestion and wear on America's roadways. 105,000 carloads of merchandise traffic are estimated to convert from road to rail when single-line service is available to the watershed markets. The merger will provide efficient, flexible, and reliable single-line access to more than 100 ports connecting to global markets and 10 international gateways to markets in Canada and Mexico. The combined company plans to introduce a total of six premium intermodal lanes operating seven days a week to meet expected intermodal growth. The safety integration plan outlines how the new company will combine best practices from each railroad to enhance safety benefits for all employees.
Financial Projections: The companies anticipate investing an estimated $2.1 billion of incremental capital to support revenue and cost synergies. They expect $133 million in annual capital synergies by leveraging the combined network and fleet more efficiently.
Job Creation and Protection: The merger is expected to create about 900 net new union jobs by the third year following the merger. Every employee with a union job at the time of the merger will continue to have one, and any merger-related union job efficiencies will be achieved solely through attrition.
The transaction is subject to STB review and approval within its statutory timeline and will be subject to continuing STB oversight post-closure. The two companies expect the transaction to be completed by early 2027. The market has reacted to these announcements by moving the company's shares -0.12% to a price of $234.15. If you want to know more, read the company's complete 8-K report here.
