Warren Buffett Won’t Buy Another Railroad, Met CSX CEO For Greater Cooperation: Report

Warren Buffett is reportedly not looking to acquire another railroad, but he recently met with CSX Corp’s (CSX) CEO “about greater cooperation.”

According to a CNBC report, Buffett and Greg Abel, who is set to become the next CEO of Berkshire Hathaway (BRK.A) (BRK.B), met CSX CEO Joseph Hinrichs in Omaha on August 3. The report added that Buffett and Abel noted they would not make a bid for CSX, but CSX and their BNSF Railway could combine and gain some of the same benefits.

In 2009, Berkshire Hathaway announced its decision to buy BNSF Railway, one of North America's freight railroad networks. The company had then said it would acquire BNSF for $100 per share in cash and stock for the remaining 77.4% of outstanding shares, Berkshire did not own.

According to CNBC on Monday, Buffett said that the partnership between CSX and BNSF would help move freight across the United States “without any slowdowns or needing to transfer to another train line.”

Retail sentiment on CSX improved to ‘bullish’ from ‘neutral’ territory a day ago, with message volume at ‘normal’ levels, according to data from Stocktwits. Shares of CSX were down over 6% during midday trading on Monday. The stock has lost 4% of its value in the last 12 months.

Union Pacific Corp (UNP) had earlier announced it would buy Norfolk Southern Corp (NSC) in a deal valuing the latter at an enterprise value of $85 billion. Under the terms of the agreement, Union Pacific will acquire Norfolk Southern in a stock and cash transaction, implying a $320-per-share value for Norfolk Southern. The deal would result in the connection of over 50,000 route miles across 43 states from the East Coast to the West Coast, linking approximately 100 ports.

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