CN backs Union Pacific’s Norfolk Southern bid

Canadian National has agreed to drop its opposition and support Union Pacific’s (UNP) proposed acquisition of Norfolk Southern (NSC) under a settlement announced July 22–23, 2026. The understanding is described as a binding memorandum of understanding that would only take effect if regulators approve the deal and the merger closes. This marks a significant change in stance by CN, which had previously been among the railroads challenging the transaction.

Union Pacific’s planned purchase of Norfolk Southern (NSC) is valued at about US$85 billion. As described in recent reporting, the combination would create what has been characterized as the first transcontinental U.S. railroad, handling roughly 40% of U.S. rail traffic. Several rivals, including BNSF, CPKC and CSX, have opposed the merger over competitive concerns.

Under the settlement framework, CN would gain expanded competitive access in the U.S. Midwest if the merger is completed. CN would acquire Norfolk Southern’s ownership interests in the Kansas City Terminal Railway Company and the Terminal Railroad Association of St. Louis, giving it a direct stake in key gateway terminal operations. These assets are central nodes for interchange and routing in the Kansas City and St. Louis regions.

CN would also obtain overhead rights between Tuscola and East St. Louis and rights to serve customers between St. Louis and Kansas City. In addition, CN would gain use of Union Pacific’s Neff Yard in Kansas City, further strengthening its operational footprint in the area. The package is presented as enhancing CN’s ability to compete for traffic, including flows to and from Mexico.

Union Pacific CEO Jim Vena said the agreements with CN help address competitive concerns surrounding the proposed merger. He described the overall package as "more compelling" when discussing Union Pacific’s second-quarter results. Union Pacific presents the settlement as preserving competitive options for affected shippers while delivering routing benefits for the combined UP–NS network.

CN President and CEO Tracy Robinson said the framework would preserve competitive access for customers in key North American markets. She emphasized that the arrangements support CN’s ability to continue offering meaningful competition and customer choice. Both companies frame the settlement as a way to balance network efficiencies with competitive safeguards.

The settlement comes as the U.S. Surface Transportation Board continues its detailed review of the Union Pacific–Norfolk Southern merger application. The STB has requested additional information from the railroads as part of this process. Regulators also recently ordered the public redesignation of certain employee-impact data tied to the merger review, signaling continued scrutiny of how the transaction could affect the workforce.

The memorandum of understanding between Union Pacific and CN remains contingent on STB approval and on the merger closing. Until regulators rule, the proposed access rights, asset transfers, and operational changes outlined in the settlement framework are not in effect. The STB’s eventual decision will determine whether the UP–NS combination and the associated CN arrangements move forward.