BREAKING NEWS: STB rules UP-NS merger application is incomplete 

The Surface Transportation Board (STB) today announced it reached a unanimous decision finding that the merger application submitted by Union Pacific Railroad and Norfolk Southern Railway is incomplete because it doesn’t contain certain information required by the board’s regulations. 

The decision is based solely on the incompleteness of the application, which the STB received on Dec. 19, and is not an indication of how the board might ultimately assess any future revised application, STB members said in a press release. 

Information that must be contained in a major merger application includes: a full system impact analyses with market share projections for the entity to be created by the transaction; and the entire merger agreement, including the submission of any contract or other written instrument that pertains to the transaction. 

In the application, UP and NS project that the merger will result in traffic growth, including diversions, and state that the full impacts of the transaction will not be realized until three years post-consummation. 

“However, they present as the projected market shares only the sum of actual 2023 UP and NS estimated market shares. The application does not contain future market share projections showing the combined effects of merger-related growth, diversions and merger-influenced and other changes to market conditions that applicants anticipate,” STB members said. 

The market impact analyses must necessarily project market shares beyond the transaction’s consummation date, and therefore the application does not include the projected market shares as required, they said.   

In addition, the merger agreement does not include certain schedules and documents that are expressly made part of the merger agreement and that define the applicants’ obligations under it, the board determined.  

“Because the application failed to provide the complete merger agreement and all contracts or other written instruments pertaining to the transaction, [the] decision finds the application is incomplete,” STB members said. 

Moreover, the decision identifies several technical, minor issues that should be addressed in any revised application. 

The decision directs UP and NS to file a letter in the docket by Feb. 17 indicating if and when they anticipate filing a revised application.