U.S. regulator pauses $85 billion railroad merger review

The U.S. Surface Transportation Board paused the review of the $85 billion merger between UNION PACIFIC CORP and NORFOLK SOUTHERN CORP on May 28. Shares of Union Pacific fell 4.2% and Norfolk Southern dropped 5.4% during morning trading following the announcement. The delay signals increased regulatory scrutiny for a deal that would create the first coast-to-coast freight rail operator in the country.

### STB Demands More Data on Competition The STB halted proceedings because several parts of the revised merger application were unclear or underdeveloped. Regulators are specifically seeking supplemental information regarding enhanced competition, market share projections, and potential downstream impacts on the rail industry. While the STB accepted the application itself, it has frozen the environmental review and other formal proceedings until these gaps are filled.