UP's Vena, NS' George share thoughts on proposed merger

Ever since Union Pacific Railroad and Norfolk Southern Railway announced their merger-proposing agreement last week, many in the rail industry have wondered when the deal originated. 

According to a “Union Pacific News” item posted last week on the Class I's website, it didn’t start with dinner at a fancy restaurant between UP CEO Jim Vena and NS President and CEO Mark George. Instead, the deal came about after a series of conversations between the CEOs about how the two railroads could combine to help grow their respective companies and the industry. 

“Jim and I started talking months ago, about what we could do that was bigger than what we are doing individually, and the revenue synergies between our two companies became very clear,” said George in the UP News post. 

Added Vena: “It wasn’t a cold call. We had multiple conversations that built over time. It wasn’t ‘here’s an offer’ — it was a dialogue.” 

The web post also includes highlights of interviews that Vena and George conducted with The Associated Press, Wall Street Journal, CNBC’s Squawk Box, and several other national and trade publications. Here are some excerpts: 

Q. What do customers, investors and employees think of the deal? 

George: When the details are absorbed by the market, they’ll understand the value we’re creating. Both companies are operating from positions of strength — we’ve got excellent safety and service records and high net promoter scores with our customers. 

Vena: We’ve already had positive feedback from customers — customers who pay the bills.  

Q. Are you optimistic the Surface Transportation Board will approve the merger? 

Vena: We’re already operating a high-service, safe railroad, so the timing felt right. If you look at what the STB says a merger should accomplish — enhancing competition, benefiting customers and the U.S. — we’re hitting all of it. 

George: We’re in a position of strength — great service, great safety, growing volumes. Our respective cultures are aligned. And more broadly, the country is going through reindustrialization. Freight demand is rising, and the administration and STB appear more open to thoughtful, growth-oriented mergers. The timing just makes sense. 

Q. Will UP-NS lead to other railroad mergers? 

Vena: What others do is up to them. We can’t speak for the rest of the industry. For us, this was about creating a better service product, helping American industry win and moving freight more efficiently. 

George: This isn’t about rail versus rail. It’s rail versus highway. We hold a relatively small share compared to trucks. We’re doing the responsible thing, moving freight to privately maintained infrastructure and off public roads. 

Q. How will integration be handled? 

George: We’ve got two years to plan this integration. That gives us time to be thoughtful. We’re not flipping systems on day one — we’re going to do this carefully and deliberately. We’re highly motivated to avoid disruption. 

Vena: We’ll also avoid rushing. We’re not forcing a strict timeline. I’ve been in rail for 47 years. I’ve seen and made my share of mistakes — we won’t repeat them. 

Meanwhile, the STB last week confirmed it received a notice of intent regarding the proposed merger. The notice initiates the regulatory review process for a proposed major merger between two Class Is and starts a timeline for UP and NS to submit a merger application in three to six months, STB officials said in a press release. 

UP and NS stated they don’t plan to use a voting trust. The STB now must publish a notice of the prefiling notification in the Federal Register within 30 days.