Union Pacific offers $20 billion cash and one share of its stock to buy Norfolk Southern Tuesday in a merger that could trigger the final wave of railroad mergers across the country.
The merger would create the first transcontinental railroad in the United States that would streamline deliveries of all kinds of raw materials and goods. The railroads predict the combination would produce $2.75 billion in annual synergies.
The merger will face a tough test from regulators who worry about the problems that followed past rail deals and the potential for abuse of monopolistic power. But if this Union Pacific deal gets approved, then BNSF and CSX will face tremendous pressure to merge so they can better compete.
(This story via the Associated Press)
