Union Pacific (UP) says that it has reached an agreement to acquire Norfolk Southern for $85 billion, in a merger that would create the first coast-to-coast rail network in the United States.

The deal announced on July 29 would put roughly 40% of the nation's rail freight in the hands of a single company, The New York Times reports. According to a release from UP, combining networks to create a new Union Pacific Transcontinental Railroad will allow freight to be delivered faster, by eliminating the need to switch railroads in areas like the Ohio Valley and the Mississippi River, where connections are said to be less efficient. Currently, Union Pacific primarily operates west of the Mississippi, while Norfolk Southern's tracks are mostly east of the river. 

“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.

After merging, UP and Norfolk Southern would have more than 50,000 employees, 80% of whom belong to unions. In a statement to The Times, Brotherhood of Railroad Signalmen president Mike Baldwin expressed concerns over the potential fallout from combining the two railroads, and warned that staffing cuts and a rushed integration process would create "a recipe for diminished safety and growing distrust." In UP's release announcing the merger, Vena vowed to ensure that all union employees for both railroads will have jobs once the merger is complete.

Federal rail regulators will next review the merger proposal from UP and Norfolk Southern to determine whether it threatens to undermine the industry's competitiveness. Pending the requisite federal approval, the two companies hope to finalize the process sometime in early 2027.