The Surface Transportation Board accepted the revised merger application from Union Pacific $UNP and Norfolk Southern $NSC on Thursday but immediately placed all proceedings in abeyance, halting review of their $85 billion deal to create a coast-to-coast freight railroad.
Citing gaps in the submitted materials, the STB — the sole federal body with authority to approve or reject railroad mergers — said portions of the revised filing lacked sufficient clarity and detail. The STB ordered the two railroads to submit supplemental information by July 27, according to Reuters. The environmental review has also been put on hold.
The board said it needed the additional material to thoroughly evaluate the application, according to The Wall Street Journal. The STB is seeking clarification on enhanced competition, market share projections, and downstream merger impacts, among other areas, according to Reuters.
The announcement rattled investors. By mid-morning, Union Pacific had shed about 4.2% of its share value, and Norfolk Southern was trading approximately 5.4% lower.
After the supplemental materials are received, a one-year evidentiary review will follow, at the end of which the board has three months to render a final decision on whether the deal is in the public interest. The companies had aimed to close the merger by April next year, but a final STB decision may not come until September 2027.
The revised application, filed on April 30, came after the STB rejected an earlier version in January for failing to include information required under the board's regulations. That initial application had been submitted on Dec. 19, 2025.
The deal, announced as an $85 billion stock and cash transaction, would combine the two railroads into a network spanning more than 50,000 miles across 43 states, linking the East Coast to the West Coast. The companies said the combination would eliminate interchange delays, open new routes, and reduce transit times on key rail corridors.
Critics of the transaction — including rival carriers, business associations, and labor groups — contend that consolidating the two railroads would harm competitive markets and drive up prices paid by farmers, manufacturers, and consumers. The Department of Justice may provide non-binding advice to the STB but does not have final authority over the outcome.
Reuters reported that neither railroad had replied to requests for comment by the time of publication.