N.J. Stat. § 48:12-126
Any railroad company of this State, or any railroad company not a corporation of this State authorized by law to own or operate any railroad in this State, may lease its road or any part thereof to any other railroad company of this or any other State, or may take a lease of the road or any part thereof of any such other railroad company, or may unite or consolidate as well as merge its stock, property, franchises and roads with those of any such other railroad company or companies, or may acquire by merger the stock, property, franchises and road of any such other railroad company or companies, or may do both; provided, however, that nothing in this section shall be deemed to authorize any railroad company of this State to be merged into any railroad company that is not a corporation of this State, or of this State and some other State or States, unless the company into which it is proposed to merge such company of this State owns the entire capital stock, or is in possession of and holds under lease all of the railroad and franchises, of such railroad company of this State to be so merged.
After such lease, consolidation or merger the company or companies so acquiring such stock, property, franchises and road may use and operate such road as their own road and collect fares and freight as provided in the case of railroad companies organized under the laws of this State, but not in excess of the charges on the line of any of the consolidated or merged companies, nor in excess of the rates limited by any special act incorporating such company.
Such leasing, consolidation or merger may be made where the roads of the companies connect either directly or over the intervening line of one or more other railroad companies.
N.J.S. § 48:12-126