Union Pacific and Norfolk Southern confirmed that they are in “advanced” merger talks that would create a single U.S railroad with service stretching from the East to the West Coast. The Associated Press reported last week that the companies were discussing a tie-up but neither company acknowledged that until Thursday morning.

Union Pacific, the largest U.S. railroad operator, said on Thursday it is in advanced talks with rival Norfolk Southern, signaling that a deal to form a $200 billion coast-to-coast rail company could be close - and potentially trigger further consolidation among remaining freight rail giants.

The combination of two large rail companies would create the first coast-to-coast network, but the deal could reduce competition.