Relative Valuation Calibration Ratio Company name BNSF NORFOLK UNION PACIFIC Share price $ 78,00 $ 79,38 $ 44,48

Operating Income (In millions) $ 1.533,00 $ 1.062,00 $ 1.395,00 Average Multiple

Valuation of Conrail (September 30, 1996) Operating income (In millions) $ Share price (In millions) $ No of shares (In millions) Equity Value (In millions) $

456,00 23,94 77,443 1.854,12

Multiple Price/Operating Income 0,05 0,07 0,03 0,05

Preceden Transaction Offer price per share as a Multiple of EPS Book value 21,4 4,5 14,6 1,7 13,4 2,8 18,3 5,5 18,4 3,7 17,22 3,64

Target Santa Fe Pacific Kansas City Southern Santa Fe Pacific Chicago & North Western Southern Pacific Average Multiples

Acquirer Burlington Northern Illionis Central Union Pacific Union Pacific Union Pacific

Conrail Company Values

EPS

Book value 4,91 $ 32,46

Valuation Of Conrail (September 30, 1996) Share price $ 84,55 $ No of shares (In millions) $ 90,50 $ Equity Value (In millions) $ 7.651,79 $

118,15 90,50 10.692,97

Total EV as a Multiple of Sales EBITDA 2,6 3,6 1,8 2,4 1,7 2,42

13,1 9,9 9,2 8,5 12,2 10,58

Sales (In millions) $

EBITDA (In millions) 1.017,00

3.722,00 $

Total EV (In millions) Debt (In millions) Cash (In millions) Equity value (In millions) No of shares (In millions) Share price

$ $ $ $ $

9.007,24 2.094,00 44,00 6.869,24 90,5 75,90

$ $ $ $ $

10.759,86 2.094,00 44,00 8.621,86 90,5 95,27

rf rm-rf beta ke wacc

6,8 7,5 1,505 18,0875

Interest debt kd

137 1891 0,072448

172

185

192

194

137

176