Union Pacific Corporation and Norfolk Southern Corporation confirmed that the companies are engaged in advanced discussions regarding a potential business combination.
In a statement posted to Union Pacific’s website, officials said there can be no assurances as to whether an agreement for a transaction will be reached or as to the terms of any such transaction.
While officials said they’d have no further comment at this point, The Associated Press reported last week the potential merger would combine the largest and smallest of the country’s six major freight railroads.
According to the AP, there is some question whether a merger would be approved by U.S. regulators, which have established a high bar for consolidation in the rail industry.
To be approved, any major rail merger must show it will enhance competition and serve the public interest under rules established in 2001, in the wake of that pair of mergers, according to the AP report.
Union Pacific reported Thursday its adjusted profit grew to $1.8 billion in the second quarter. The Omaha, Nebraska company’s, per-share earnings rose rose to $3.03, beating Wall Street expectations and easily topping the $2.71 per-share profit it reported in the same period last year. Analysts were expecting profit of $2.91 per share for the recent quarter.
