Union Pacific and Norfolk Southern informed the U.S. Surface Transportation Board on Feb. 17 that they intended to file a revised merger application on April 30. On January 16, the STB rejected the two railroads’ initial merger application for being “incomplete,” a major blow for what would be the largest rail merger in history. 

Among the issues the STB identified in the initial application was an incomplete market analysis. For example, UP and NS stated that it would take three years for the merger’s increased traffic benefits to be realized. However, the application did not provide an analysis of the traffic levels three years in; it only showed what they would be on the first day of the combination. Additionally, applicants are legally required to provide copies of “Any contract or other written instrument entered into, or proposed to be entered into, pertaining to the proposed transaction.” However, UP and NS included only the “Agreement and Plan of Merger,” not the full contract. 

The STB’s decision was a win for BNSF Railway, Canadian National, CPKC, and CSX Transportation, which have all been speaking out against the UP-NS combination. One of their chief complaints was that the merger application was incomplete, preventing a full evaluation. 

—Justin Franz