3M’s stock staged a sharp rally after the industrial giant agreed to a $7.35 billion settlement covering thousands of personal injury claims linked to its notorious “forever chemicals.” The deal has offered investors a measure of relief, with the company’s shares climbing to their highest level in more than eight years.
The settlement, announced after US markets closed on Tuesday, is designed to resolve claims brought by people who allege that exposure to PFAS chemicals in 3M-manufactured firefighting foam caused serious health problems. The company expects the agreement to attract enough claimants to move forward.
Under the proposed arrangement, payments will be spread over nine years and could cover as many as 120,000 individuals.
Settlement Removes a Major Legal Cloud
The dispute revolves around per- and polyfluoroalkyl substances, commonly known as PFAS. These chemicals have earned the nickname “forever chemicals” because they persist in the environment and can remain in the human body for extended periods.
PFAS exposure has been associated with a range of health concerns, including elevated cholesterol, low birth weight and certain cancers, such as kidney and testicular cancer.
3M has not admitted wrongdoing as part of the settlement. However, the company expects to record a $5.8 billion pre-tax charge in the fourth quarter, reflecting the present value of its anticipated future payments.
The agreement is expected to resolve approximately 99% of personal injury claims connected to firefighting foam litigation, both within and outside the federal multidistrict proceedings in Charleston, South Carolina.
For investors, the settlement could mark a turning point. UBS analyst Amit Mehrotra noted that market expectations had been closer to a $10 billion payout, making the announced figure less burdensome than anticipated. The agreement also removes a significant source of uncertainty that had weighed on 3M’s stock.
Shares Reach Levels Not Seen Since 2018
The market reaction was immediate.
3M shares climbed as much as 10% during Wednesday’s trading session, reaching their highest level since March 2018, when the stock traded above $200. By afternoon, the shares were up 9.8% at $194.37.
The rally reflects growing confidence that the company may finally be putting one of its most expensive legal battles behind it.
Payments Expected to Stretch Into the Next Decade
3M’s chief legal affairs officer Kevin Rhodes said the settlement is intended to address both existing and future PFAS-related personal injury claims.
The company expects to make the bulk of its payments between 2028 and 2033. The agreement also includes an exit provision allowing 3M to withdraw if an insufficient number of claimants participate, although Rhodes said the company does not anticipate such an outcome.
Meanwhile, US District Judge Richard Gergel has paused personal injury proceedings against 3M in the litigation. The judge called on the company and claimants to devote substantial time and effort to implementing the settlement.
Representatives of the claimants welcomed the agreement, saying it provides relief to thousands of people who have spent nearly a decade seeking answers and accountability.
Firefighting Foam at the Centre of the Dispute
The litigation primarily concerns aqueous film-forming foam, a firefighting product widely used to extinguish intense fires at military installations, airports and other facilities.
PFAS compounds have also been used in protective equipment worn by firefighters, including 3M’s Scotchlite reflective material.
The company has said it stopped manufacturing PFAS in 2025.
The latest settlement follows a series of costly agreements tied to the chemicals. In 2023, 3M reached a $10.3 billion deal with US cities and towns over allegations that PFAS had contaminated drinking water supplies. It also agreed to a settlement worth between $400 million and $450 million with New Jersey in 2025.
The broader PFAS litigation landscape remains extensive. Other major chemical manufacturers, including DuPont, Corteva and Chemours, are also facing claims related to the chemicals.
For 3M, the $7.35 billion agreement represents another substantial financial commitment. But with investors reacting positively and a major portion of the personal injury litigation moving toward resolution, the company may be entering a new phase in its long-running effort to contain the fallout from PFAS.
