Norfolk Southern Stock Downgraded

November 8, 1999 9:35 AM, EST

Standard & Poor’s has downgraded its rating of Norfolk Southern Corp. to "negative" from "stable" as a result of the company’s problems with its takeover of part of Conrail.

The outlook, according to S&P, "reflects significantly worse than expected results following the company’s June 1 assumption of control of its 58% ownership of Conrail Inc."

NS estimated that about $73 million of third-quarter revenue was diverted to other modes of transportation.

However, S&P said in the long term it expects both NS and CSX, which operates the rest of the former Conrail system, to "ultimately benefit from their more extensive systems."