Union Pacific Corporation (UNP) entered a merger agreement on July 29, 2025, to acquire Norfolk Southern Corporation (NSC) in a cash and stock deal worth $85 billion.
Under the terms of the agreement, Norfolk Southern shareholders will receive 1 Union Pacific common share and $88.82 in cash for each share of Norfolk Southern, representing an implied value of $320 per share. The purchase price is at a 11.72% premium from the stock’s last close.
Union Pacific is a leading U.S. railroad company that provides freight transportation across 23 western states, connecting industries and communities to the global economy through its extensive rail network.
Norfolk Southern is a major U.S. freight railroad company operating across 22 states, providing transportation for a wide range of goods—from agriculture to consumer products—while maintaining the largest intermodal network in the eastern United States.
Two weeks ago, WSJ reported that Union Pacific was holding talks to acquire Norfolk Southern. Union Pacific confirmed these talks last week. The stock was trading at $269.81 before the report came out.
These two railroad operators will join together to connect over 50,000 miles of rail routes across 43 states, from the East Coast to the West Coast, reaching around 100 ports and nearly all of North America.
The companies expect to close the deal by early 2027.
Union Pacific will issue approximately 225 million shares to Norfolk Southern shareholders, giving them a 27% ownership stake in the combined company on a fully diluted basis.
The cash part of the deal will be paid using a mix of new debt and existing cash from Union Pacific’s balance sheet.
Jim Vena, CEO of Union Pacific, will lead the combined company and has committed to remain in the role for at least the next five years. Upon closing, three Norfolk Southern directors, including Norfolk Southern CEO Mark George and Board Chair Richard Anderson, are expected to join the Union Pacific Board.
The combined company will be based in Omaha, Nebraska. Atlanta, Georgia, will continue to play an important role long-term, with a focus on technology, operations, innovation, and other key areas.
BofA Securities served as financial advisor to Norfolk Southern, with legal counsel provided by Wachtell, Lipton, Rosen & Katz and Sidley Austin. Union Pacific received financial advice from Morgan Stanley and Wells Fargo, and legal counsel from Skadden, Arps, Slate, Meagher & Flom and Covington & Burling.
Union Pacific is paying 11.50 times the EBITDA of Norfolk Southern.
For a deeper understanding of this merger and acquisition transaction, please refer to the Deal Metrics page
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Editor’s Note: Baranjot Kaur contributed to this article