Union Pacific and Norfolk Southern today cleared their first merger hurdle as shareholders overwhelmingly backed their deal to create the first transcontinental railroad.
In separate votes, nearly 99% of NS shareholders and 99.5% of UP shareholders approved UP’s proposed $85 billion acquisition of NS.
Shares in UP (NYSE: UNP) were unchanged on the news in early morning trading, while NS (NYSE: NSC) rose slightly more than 1%.
“The approval of our shareholders marks a key milestone in our journey to create America’s first coast-to-coast transcontinental railroad, combining complementary networks and capabilities to unlock a multiplier effect for benefits to all stakeholders,” NS Chief Executive Mark George said in a statement.
NS investors will receive one Union Pacific common share and $88.82 in cash for each share of Norfolk Southern owned.
UP investors, meanwhile, were asked to approve the issuing of new shares of UP common stock in connection with the merger.
“We appreciate our shareholders’ support in reaching this important milestone on our path to building America’s first coast-to-coast railroad,” UP CEO Jim Vena said in a statement.
The railroads plan to file their merger application with the Surface Transportation Board in early December.
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