Business Notes Railroads

Norfolk Southern, the nation's fourth largest railway, conceded defeat last week in its 18-month-long bid to buy Conrail, the now profitable Government- owned rail system. Early last year Transportation Secretary Elizabeth Dole had selected Norfolk Southern as the best qualified of 15 bidders to buy Conrail's freight-hauling business for $1.2 billion. Last February the Senate approved, and the much bruited merger seemed to be on track.

Then came trouble. Critics in the House of Representatives argued vociferously that the price for Conrail was too low and that a public offering of Conrail stock would reap much more than the private railroad was prepared to offer. Norfolk's concession puts Conrail back on the siding.