After a report the previous day that Union Pacific Corp. could be exploring an acquisition of Jacksonville-based CSX Corp., The Wall Street Journal reported late July 17 that the western railroad is instead in talks with CSX rival Norfolk Southern Corp.
The report by news website Semafor said Union Pacific, which operates in 23 western states, was working with investment bankers at Morgan Stanley to pursue a deal with one of the two major eastern railroads, CSX or Norfolk Southern.
Union Pacific CEO Jim Vena has made public comments about his interest in creating a transcontinental railroad.
The Journal story did not mention CSX. It said Atlanta-based Norfolk Southern is in a vulnerable position after criticism of its response to a major 2023 derailment in Ohio and a scandal involving its former CEO Alan Shaw, who left the company last year.
The Journal said talks between Union Pacific and Norfolk Southern are in early stages and may or may not lead to a deal.
Any merger involving the six large Class I freight railroads would face tough scrutiny from the U.S. Surface Transportation Board. However, analysts have speculated that regulators may be more amenable to a big merger under the Trump administration.
Besides CSX, Union Pacific and Norfolk Southern, the other three Class I railroads are BNSF Railway, Canadian National Railway and Canadian Pacific Kansas City.
CSX’s stock rose as much as $1.53 to $34.79 on July 17, its highest level since December, after the Semafor story. It closed at $34.50.
CSX opened 83 cents higher at $35.33 on July 18 after the Journal report.