Union Pacific to Buy Out GATX Stake for $1.1B

TL;DR

UP buying out GATX's 49% stake in their JV for $1.1B, full control incoming.

AI Summary

Union Pacific Corporation announced on September 19, 2024, that it has entered into a definitive agreement to acquire the remaining 49% stake in its joint venture, Union Pacific Railroad Company, from GATX Corporation for approximately $1.1 billion. This transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions.

Why It Matters

This acquisition will give Union Pacific full control over its railroad operations, potentially leading to streamlined decision-making and improved operational efficiencies.

Risk Assessment

Risk Level: medium — The acquisition is subject to customary closing conditions, and the integration of the remaining stake could present unforeseen challenges.

Key Numbers

• $1.1B — Acquisition Price (Union Pacific is acquiring the remaining 49% stake in its joint venture.)
• 49% — Stake Acquired (Union Pacific is acquiring the remaining stake from GATX Corporation.)

Key Players & Entities

• Union Pacific Corporation (company) — Registrant
• GATX Corporation (company) — Joint venture partner
• Union Pacific Railroad Company (company) — Joint venture
• September 19, 2024 (date) — Announcement date
• fourth quarter of 2024 (date) — Expected closing period
• $1.1 billion (dollar_amount) — Acquisition price

FAQ

Key Financial Figures

• $2.50 — ch registered Common Stock (Par Value $2.50 per share) UNP New York Stock Excha
• $3.5 billion — t annual capital investments of roughly $3.5 billion to $3.7 billion over the next three yea
• $3.7 billion — investments of roughly $3.5 billion to $3.7 billion over the next three years; maintain a
• $4 billion — d capital; annual share repurchases of $4 billion to $5 billion over the next three years
• $5 billion — nual share repurchases of $4 billion to $5 billion over the next three years starting in 2

Filing Documents

• unp20240911_8k.htm (8-K) — 40KB
• 0001437749-24-029518.txt ( ) — 169KB
• unp-20240919.xsd (EX-101.SCH) — 3KB
• unp-20240919_def.xml (EX-101.DEF) — 11KB
• unp-20240919_lab.xml (EX-101.LAB) — 15KB
• unp-20240919_pre.xml (EX-101.PRE) — 11KB
• unp20240911_8k_htm.xml (XML) — 3KB

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. As previously announced, Union Pacific Corporation (the "Company") is holding its 2024 Investor Day today in Dallas, Texas. The agenda for the conference and the live webcast for the presentation are available on the Company's website at https://investor.unionpacific.com/. At the Conference, the Company will be providing the following financial guidance related to its operations and capital structure: expect revenue (excluding fuel surcharge revenue) will grow faster than volume (excluding coal) which will outpace the markets the Company serves over the next 3 years; anticipate pricing dollars will be accretive to operating ratio starting in 2025; maintain an industry leading operating ratio; forecast an earnings per share compound annual growth rate in the high single to low double digit range; expect annual capital investments of roughly $3.5 billion to $3.7 billion over the next three years; maintain a strong, investment grade credit rating; retain an industry leading return on invested capital; annual share repurchases of $4 billion to $5 billion over the next three years starting in 2025; strive for consistent, annual dividend increases; and dividend payout ratio target of approximately 45% of earnings. This Form 8-K disclosure contains forward-looking statements that are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements. Important factors, including risk factors, regarding forward-looking information and these risks and uncertainties are discussed in the Company's filings with the Securities and Exchange Commission.

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: September 19, 2024 UNION PACIFIC CORPORATION By: /s/ Jennifer L. Hamann Jennifer L. Hamann Executive Vice President and Chief Financial Officer

View Full Filing

View this 8-K filing on SEC EDGAR