Union Pacific announced Friday that its investors overwhelmingly endorsed the company’s proposed $85 billion acquisition of Norfolk Southern, a move the rail giants claim will forge the nation’s first fully transcontinental railroad network.

At a preliminary shareholder meeting, 99.5% of votes cast favored authorizing new Union Pacific common stock to complete the merger—support representing nearly 80% of all outstanding shares. A final tally will be disclosed in an upcoming filing with the U.S. Securities and Exchange Commission.

Union Pacific CEO Jim Vena praised the vote, calling it a defining step toward building what he described as America’s first coast-to-coast rail system. “Our shareholders see the value and understand this merger will unlock new opportunities to enhance service, growth and innovation,” he said.

$85B Deal Blends Cash, Stock, and a Massive Rail Network

The July-announced transaction values Norfolk Southern shares at roughly $320 and includes a cash-and-stock exchange. Under the terms, Norfolk Southern shareholders will receive one Union Pacific share plus $88.82 in cash for each share they own. Union Pacific expects to issue about 225 million new shares to finalize the transaction.

If regulators sign off, the combined company would command more than 50,000 miles of track in 43 states, creating a coast-spanning network that backers say will unify freight routes and drive efficiency. The deal still hinges on approval from the Surface Transportation Board (STB).

Regulatory Scrutiny Looms as Critics Sound Alarm

In response to growing questions about consolidation, Vena has dismissed fears that the merger would recreate the dominance railroads once held. He has repeatedly argued that trucking—not rail—is the industry’s fiercest competitor, saying deeper integration would help rail carriers “more effectively deliver for customers.”

“Does anybody want to go back to 40 Class I railroads? Absolutely not,” he said at a September investor conference. “Where we are is trucks are our biggest competition.”

But not everyone is convinced. Major labor unions—including SMART-TD and the Transport Workers Union—have vowed to challenge the merger before regulators. Public interest groups have echoed these warnings, and a bipartisan group of U.S. senators recently urged the STB to conduct a rigorous review, citing the potential for service disruptions and harm to agricultural shippers.

The agreement also includes a $2.5 billion breakup fee if the merger collapses.

Next Stop: Surface Transportation Board Review

Vena said the companies are preparing their formal application for the STB, promising to demonstrate how the merger would deliver seamless single-line service nationwide, improve transit times, bolster safety, and enhance U.S. rail competitiveness.

“We look forward to filing our application,” Vena said, underscoring the next critical step in what could become one of the most transformative rail mergers in modern U.S. history.