Union Pacific Corp. could reach an agreement to acquire Norfolk Southern Corp. and create a transcontinental rail behemoth as soon as early next week, people familiar with the matter said.The deal, which would be the largest deal ever in the rail industry,

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

Union Pacific reported a strong second-quarter adjusted profit of $1.8 billion, exceeding expectations, as merger speculation with Norfolk Southern intensified. The potential tie-up, aiming to create a transcontinental railroad,