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  "documentTitle": "Norfolk Southern Corporation (NSC)",
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  "authorName": "Move NSC Forward",
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  "notes": "Includes a pull-quote from FreightWaves to support the strategic importance of the Meridian Speedway.",
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      "kind": "callout",
      "text": "The Board and Mr. Shaw rushed into a bad deal that gets Norfolk Southern a short-term PR win while CPKC and CSX, the Company's closest peers, strengthen their partnership and competitive offerings.",
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      "text": "In addition to the $25 million payment, Norfolk Southern agreed to give up part of its long-term franchise, in the form of concessions related to the Meridian Speedway and Terminal.\nIt is important to keep in mind that Norfolk Southern invested approximately $300 million for a 30% stake in the Meridian assets in 2006, suggesting the net present value of that stake is worth significantly more today.\nThe Company has stated that the concessions were related to a portion of the Meridian Speedway that accounts for 1% of total annual revenue, or approximately $120 million.\nBased on sales attributable to the Meridian asset, an operating margin of 30%, tax rate of 22% and market-based earnings multiple of 20x, we estimate a total of $560 million of value being impacted by these concessions.\nThis amount appears material to us, given that Norfolk Southern is trying to close a $17 billion market value gap with CSX.\nNorfolk Southern no longer has the right of first refusal for domestic intermodal traffic moving between the Southeast and the Wylie Intermodal terminal if it moves via the planned CPKC/CSX connection in Myrtlewood, Alabama.\nNorfolk Southern will no longer have the opportunity of matching or beating bids as it will need to compete directly with the other alternatives (i.e., CPKC/CSX).\nThis could bring additional rail competition into the market that could negatively impact Norfolk Southern's ability to take share from trucking.",
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      "text": "market value gap: $17 billion",
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      "text": "The Board also made concessions related to the Meridian Speedway, essentially permitting CPKC to realize greater value from its transaction involving the Meridian & Bigbee Railroad, which it is pursuing with CSX.",
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      "text": "The Meridian Speedway ... is a corridor that serves NS' intermodal segment and goes between the Southeast and the central Texas market and the Southeast and Southwest markets in California and Arizona ... NS stressed the importance of the corridor to its business when STB was reviewing the merger between CP and KCS.",
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      "text": "The Meridian Speedway ... is a corridor that serves NS' intermodal segment and goes between the Southeast and the central Texas market and the Southeast and Southwest markets in California and Arizona ... NS stressed the importance of the corridor to its business when STB was reviewing the merger between CP and KCS. — FreightWaves",
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      "text": "FreightWaves article (Oct. 27, 2023). Company filings.",
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      "text": "The Board's Defensive COO Hire Comes at a Significant Cost (Cont.)",
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