Union Pacific is in talks to merge with Norfolk Southern, The Wall Street Journal reported Thursday, in a deal that would shake up the railroad business in America. The Journal cited people familiar with the matter.

Merger talk is swirling around Union Pacific Corp. and Norfolk Southern Corp., in a deal that could create a railroad mega-carrier and a huge transcontinental network spanning the U.S.

The rails sector is on high alert following reports that Union Pacific (UNP) is focused on acquiring Norfolk Southern (NYSE:NSC), which could create the nation's first coast-to-coast rails network if the deal cleared regulatory and White House scrutiny.