Union Pacific and Norfolk Southern said on Tuesday that they have agreed to a merger to create a $200 billion rail giant based on their current market capitalizations.

Union Pacific Corp. agreed to acquire Norfolk Southern Corp. in a $72 billion cash-and-stock transaction, forming the only US transcontinental railroad in what stands to be the industry’s largest deal ever.

The deal would create the first transcontinental railroad in the United States worth more than $200 billion, combining Union Pacific’s rail network in the West with Norfolk’s rails that snake