Union Pacific is looking to buy Norfolk Southern in an $85 billion deal that would establish the U.S.’ first transcontinental railroad, the Associated Press reports. The move could also potentially trigger a final wave of rail mergers nationwide.
Announced Tuesday, the proposed merger would join Union Pacific’s rail network in the West with Norfolk’s rails across Eastern states.
While the nation was first linked by rail in 1869, no single entity has controlled the coast-to-coast passage relied upon by so many businesses. Railroads said the tie-up would streamline deliveries of raw materials and goods across the U.S. by eliminating several days of delays when shipments are handed off between railroads.
A possible deal would face close scrutiny by antitrust regulators, who have set a high bar for railroad deals after previous industry consolidation led to massive backups and snarled traffic.
If the deal is approved, however, the two remaining major American railroads — BNSF and CSX — will face enormous pressure to merge so they can compete.
