Union Pacific Corp. agreed to acquire Norfolk Southern Corp. in a cash-and-stock transaction valued at $85 billion, forming a transcontinental rail

The Union Pacific and Norfolk Southern corporations announced Tuesday the companies will merge to create America's first transcontinental freight railroad.

Union Pacific, the largest U.S. freight railroad operator, is exploring a possible acquisition of Norfolk Southern to create a $200 billion coast-to-coast rail network, a person familiar with the matter said.