Union Pacific, Canadian National Railway boost rail connectivity; resolve Norfolk Southern merger dispute

Union Pacific (UNP) and Canadian National Railway (CNI) signed a series of agreements  to improve freight rail service across North America and resolve Canadian National Railway's (CNI) opposition to Union Pacific's (UNP) proposed acquisition of Norfolk Southern (NSC).

Under the agreements, Union Pacific (UNP) will gain expanded access to CNI's (CNI) rail route around Chicago, while CNI (CNI) will gain access to Union Pacific's (UNP) rail network between Memphis and Eagle Pass, Texas, improving freight connectivity between Canada and Mexico.

Separately, CNI (CNI) agreed to withdraw its opposition to Union Pacific's (UNP) proposed acquisition of Norfolk Southern (NSC) in exchange for expanded access to Union Pacific's (UNP) network after the merger closes.

As part of the arrangement, CNI (CNI) will receive trackage rights in Illinois and Missouri, ownership interests in key rail terminals in Kansas City and St. Louis, and continued access to certain customer facilities.

The companies said the agreements will expand shipping options, strengthen Canada-Mexico freight links, and improve rail efficiency and competition across North America.

Union Pacific (UNP) shares rose about 1.9% in after-hours trading on Wednesday.