Union Pacific and Norfolk Southern have offered to divest stakes in several jointly owned rail infrastructure companies as part of their planned US$85 billion (A$123 billion) merger.
The companies said on Tuesday they had submitted the first portion of responses to the United States Surface Transportation Board’s (STB) request for additional information on their merger application.
The deal under which Union Pacific would buy Norfolk Southern in a cash-and-stock merger would create the first U.S. coast-to-coast freight rail operator.
The filing addressed concerns about the Terminal Railroad Association of St. Louis (TRRA), Kansas City Terminal Railway (KCT) and TTX Company, which are jointly owned with other major railroads but operate under independent management teams and non-discrimination policies.
Union Pacific and Norfolk Southern said they did not control the companies currently and would not control them after the merger, but the STB could require divestitures as a further safeguard.
The companies said the combined network could shift more freight from roads to rail, reducing congestion and lowering emissions.
"Connecting Union Pacific and Norfolk Southern’s end-to-end networks will finally give American shippers single-line transcontinental rail service," the companies said in their filing.
Union Pacific and Norfolk Southern said the filing provided evidence that rival rail companies were using TRRA as an argument to delay or block the transaction.
The companies said other Class I railroads, including BNSF, CSX and Canadian National, did not attend a special meeting called to discuss options for reducing Union Pacific’s ownership interest in TRRA after completion of the merger.
Union Pacific shares (NYSE: UNP) closed 48 cents (0.17%) higher at $283.12, capitalising the company at $168.09 billion, on Tuesday (Wednesday AEST).
Norfolk Southern shares (NYSE: NSC) ended 84 cents (0.26%) higher at $322.74, valuing the company at $72.49 billion.
