Regulators Reject Union Pacific and Norfolk Southern Merger Application Over Missing Data

2026-01-17 companies

Homewood, Saturday, 17 January 2026.
Federal regulators rejected the historic Union Pacific and Norfolk Southern merger bid, deeming the massive 7,000-page application incomplete and effectively pausing the first transcontinental railroad deal.

A Procedural Roadblock

On January 16, 2026, the Surface Transportation Board (STB) unanimously rejected the merger application submitted by Union Pacific (NYSE: UNP) and Norfolk Southern (NYSE: NSC), dismissing the filing ‘without prejudice’ [3][5]. This designation allows the railroads to address the deficiencies and resubmit, but it represents a significant pause in the timeline for the first proposed transcontinental railroad combination [3][5]. Despite the initial application—filed on December 19, 2025—spanning approximately 6,772 pages, regulators determined that the documentation failed to meet the statutory requirements necessary to fully assess the transaction’s impact on the public interest [3][4].

Critical Data Gaps

The board’s 15-page decision highlighted specific analytical failures, particularly regarding market share data [5]. While the applicants provided market share figures based on 2023 actuals, they failed to project future market shares that would account for the traffic growth they explicitly claimed the merger would generate [3][4]. Furthermore, the STB noted the omission of essential documents, including ‘Schedule 5.8’ and complete sections of the merger agreement detailing the terms under which Union Pacific could withdraw from the transaction [3][4]. These gaps prevented the rigorous system impact analysis required by federal regulations [3].

The St. Louis Complication

A pivotal issue in the rejection centered on the Terminal Railroad Association of St. Louis (TRRA), a strategic switching operator jointly owned by Union Pacific, Norfolk Southern, BNSF Railway, CSX, and Canadian National [4]. The merger applicants had categorized the disposition of the TRRA as a ‘minor’ transaction within their filing [4]. However, the STB reclassified this as a ‘major’ transaction, noting that the merger would effectively grant Union Pacific a controlling interest in this vital logistics hub [4]. This reclassification mandates a significantly more detailed application process to ensure competitive balance is maintained [4].

Industry Reaction and Next Steps

The decision has drawn immediate support from industry competitors and trade groups concerned about consolidation. Canadian National (NYSE: CNI), which had filed a motion on January 8 to compel further disclosure, stated that the application was ‘missing the last mile’ required for a transparent review [1][3]. Similarly, the American Chemistry Council (ACC) commended the rejection, describing the proposal as the ‘largest, most expensive’ merger in the board’s history and warning that it could tighten the grip of dominant players on the supply chain [6]. Union Pacific and Norfolk Southern have until February 17, 2026, to notify the board if and when they intend to file a revised application [5]. Union Pacific has confirmed it intends to provide the additional information requested [5].

Sources

Railroad Mergers Antitrust Regulation