New Delhi, July 29 -- Union Pacific Corp agreed to acquire Norfolk Southern Corp in a cash-and-stock transaction valued at $85 billion.

The deal will create a transcontinental rail giant, linking Union Pacific's extensive western US network with Norfolk Southern's East Coast routes. If approved, the deal would be the largest-ever buyout in the industry.

Norfolk Southern shareholders will receive one Union Pacific share and $88.82 in cash for each Norfolk share. Union Pacific will issue about 225 million shares to Norfolk Southern investors, representing 27% stake in the combined company.

The agreement, which the companies aim to close by early 2027, implies a value of $320 a share for Norfolk, or about $72 billion on an equity basis. T...