CHICAGO (Reuters) - No. 3 U.S. railroad CSX Corp does not see any compelling benefits stemming from mergers of major railroads in North America and fears regulatory burdens could be attached to the approval of deals that would add to the cost of doing business, the railroad’s top executive said on Wednesday.

A CSX coal train (R) moves past an idling CSX engine at the switchyard in Brunswick, Maryland in this October 16, 2012, file photo REUTERS/Gary Cameron/Files

“The benefits seem somewhat unconvincing, I really think the Class I railroads have great opportunities to create shareholder value without mergers,” Chief Executive Michael Ward told Reuters by phone when asked about Canadian Pacific’s unsolicited bid for No. 4 U.S. railroad Norfolk Southern Corp.

“I think mergers could actually be destructive of shareholder value,” he added.

Ward said that CSX has met with representatives of other major railroads in the presence of legal counsel. Those representatives include Matt Rose, chairman of BNSF [BNISF.UL], the No. 2 U.S. railroad which is owned by Warren Buffett’s Berkshire Hathaway Inc.

No. 1 U.S. railroad Union Pacific Corp’s chief executive Lance Fritz told Reuters on Wednesday he believes major railroad mergers are not in the interest of the rail industry or customers and is working behind the scenes to make sure none take place.

By law, major U.S. railroads may only discuss topics that affect the entire industry.

“We haven’t had any new consensus come out of this,” Ward said. “To be honest we’ve had one or two discussions, but we were all against mergers to begin with.”

Canadian Pacific in mid-November disclosed its $28 billion offer to buy Norfolk Southern.

Norfolk Southern has rejected the Canadian railroad’s advances, setting the stage for a possible proxy battle. Any deal would be expected to face a tough review from rail regulator the Surface Transportation Board (STB), which would judge whether it was in the public interest.

The STB significantly tightened its guidelines for mergers following a slew of deals in the 1990s.

There are also questions about whether the voting trust Canadian Pacific has proposed would pass muster.

“It’s highly questionable whether (a deal) would pass the aggressive scrutiny of the two high standards of public interest and pre-approval control,” Ward said.

CSX’s CEO spoke to Reuters the day after the railroad posted fourth-quarter results. The company saw freight volumes fall 6 percent in the quarter and Ward said the only bright spots at the moment for 2016 are automotive and housing.

“The rest of the markets all have challenges,” he said.

Coal volumes, which were down 32 percent last quarter will continue to fall this year, metals will be down because of low commodity prices and the strong U.S. dollar and “farmers have been holding onto their corn because they’re hoping for higher prices.”

As a result, CSX expects lower earnings per share in 2016 compared with 2015.

“We’ll focus on things we can control this year,” Ward said. “We’ll focus on efficiency and productivity.”