CSX Corporation (NASDAQ:CSX) shares traded lower on Monday after reports indicating the company and the Burlington Northern Railroad have not held merger talks. CNBC also reported Berkshire is not in the market to buy a train company.
What To Know: According to Reuters, Berkshire Hathaway CEO Warren Buffett told CNBC that Berkshire isn't looking to buy another railroad, easing speculation around a potential CSX–BNSF deal.
Buffett also confirmed that during a meeting with CSX CEO Joseph Hinrichs in early August, the two discussed ways to increase cooperation between CSX and BNSF but made clear that no acquisition bid would be made. Buffett and Berkshire Vice Chairman Greg Abel met with Hinrichs in Omaha on Aug. 3, without advisors present, according to Berkshire.
The reports come after weeks of speculation about a potential combination, fueled in part by last month's surprise $85 billion merger proposal between Union Pacific and Norfolk Southern, which would create the first coast-to-coast freight rail operator in the U.S. The CSX–BNSF speculation intensified further after the two railroads announced new coast-to-coast services last week, strengthening freight connectivity but tempering merger expectations.
The news also adds pressure on CSX leadership. Activist investor Ancora Holdings, which recently boosted its stake in CSX, has urged the board to pursue merger opportunities with BNSF or Canadian Pacific Kansas City, warning the company risks falling behind by waiting for Berkshire to act.
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CSX Price Action: CSX shares were down 5.12% during regular trading and up 0.30% in after-hours trading on Monday, according to Benzinga Pro data.
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