UP merger application with Norfolk Southern ruled “incomplete,” but railroads will refile

A proposal for a megamerger, joining Union Pacific and Norfolk Southern railroads, was tossed by federal regulators Friday because it “does not contain certain information” required by the government.

The U.S. Surface Transportation Board ruled the application was incomplete, although the railroads are allowed to resubmit.

“Union Pacific will provide the additional information requested by the Surface Transportation Board,” a spokesperson said.

UP and Norfolk Southern leaders have touted the union as “an unprecedented opportunity” to create a transcontinental railroad that will offer faster and more efficient service across 43 states.

But BNSF, CPKC, CSX and CN railroads filed objections in late December, saying the application failed to prove the merits of the merger and how it would be in the public’s interest.

The STB found that the railroads did not offer projections on the effects of merger-related growth on rail traffic and the impact on competition in the future.

Also missing were schedules and documents that were part of the merger agreement between the two railroads, board officials said.

They added that the applicants failed to explain “why they withheld these materials from the board.”

It’s somewhat unusual for a major merger application to be rejected, but the STB noted its decision didn’t dismiss the request. A revised submission is expected in the coming weeks.

Also, the ruling “should not be read as an indication of how the board might ultimately assess any future revised application,” regulators said.