THE VIRGINIAN-PILOT 
              Copyright (c) 1995, Landmark Communications, Inc.

DATE: Thursday, October 26, 1995             TAG: 9510260454
SECTION: BUSINESS                 PAGE: D6   EDITION: FINAL 
SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER 
                                             LENGTH: Short :   49 lines

RAIL HAS LITTLE TO SAY ABOUT RUN ON CONRAIL

Norfolk Southern Corp.'s top executive reacted coyly Wednesday to questions about a potential merger with Conrail Inc. at a stock analysts' meeting in New York.

David Goode, the Norfolk-based railroad's chairman, chief executive and president, would not comment specifically on whether Norfolk Southern was talking with Philadelphia-based Conrail.

``I'm certain that the railroad business by the time I retire is going to look very different than it looks today,'' said Goode, 54.

``This is an exciting business to be in, mergers or no mergers,'' Goode said. ``This is a growth business. We have just begun to scratch the surface'' of expanding the railroad's transportation market share in the regions it serves, let alone in other regions.

Norfolk Southern and Conrail almost merged in the mid-1980s. They talked seriously again in the summer of 1994, and rumors of an impending merger have surfaced periodically since then, most recently in the Sept. 30 issue of Business Week.

``Norfolk Southern certainly has something to gain there,'' said Renee D. Weaver, rail stock analyst for the Richmond brokerage Wheat First Butcher Singer.

The merger of big western railroads Burlington Northern Inc. and Santa Fe Pacific Corp. in September will result in $1 billion in cost savings in the next few years, Burlington Northern Santa Fe Corp. said in announcing surprisingly strong earnings this week.

Conrail has made it clear that it wants to remain independent, but everybody has a price, Weaver said.

John Snow, chairman of Richmond-based CSX Corp., Norfolk Southern's biggest competitor, recently suggested the two railroads bid jointly for Conrail and break it up, analysts said.

When asked if any serious talks with CSX had taken place, Goode replied, ``I always enjoy reading John's press clippings.''

But most analysts believe something is going on. ``It would be foolish to think these Eastern railroads are not evaluating different options, but it's hard to say when something might happen,'' Weaver said.

She predicts there will be only two major transcontinental railroads by the turn of the century. by CNB