Union Pacific and Norfolk Southern reach $85 billion merger deal
Union Pacific and Norfolk Southern today announced an $85 billion deal to tie their networks together and create the first U.S. transcontinental railroad.
The merged company — which will be called Union Pacific — will transform the U.S. supply chain and economy, strengthen domestic manufacturing, and preserve all union jobs, the railroads said.
UP will acquire NS in a stock and cash transaction that values NS at $320 per share, a 25% premium. The combined company would have an enterprise value of more than $250 billion. The railroads said the merger would create $2.75 billion in annual synergies within three years, through a combination of $1.75 billion in revenue growth and $1 billion in cost savings.
“Railroads have been an integral part of building America since the Industrial Revolution, and this transaction is the next step in advancing the industry,” UP CEO Jim Vena said. “Imagine seamlessly hauling steel from Pittsburgh, Pennsylvania to Colton, Calif., and moving tomato paste from Heron, Calif., to Fremont, Ohio. Lumber from the Pacific Northwest, plastics from the Gulf Coast, copper from Arizona and Utah, and soda ash from Wyoming. Right now, tens of thousands of railroaders are moving almost everything we use. You name it, and at some point, the railroad hauled it.”
The railroad will stretch 52,215 route miles, with track winding through 43 states from the East Coast to the West Coast and serving around 100 ports.
