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.

Combining Union Pacific and Norfolk Southern into the first transcontinental railroad in the U.S. would create a 52,215-mile colossus that could offer seamless service from coast to coast, bypassing longtime interchange choke points in Chicago and at gateways along the Mississippi River.