Shares of the chemical company, The Chemours Company (NYSE: CC) surged in morning trading on Friday after the company along with DuPont de Nemours (DD) and Corteva (CTVA) reached an agreement to settle all PFAS-related drinking water claims of public water systems “that serve the vast majority of the United States population.” PFAS are harmful chemicals in drinking water that are injurious to health.
The companies will establish a $1.185 billion settlement fund (water district settlement fund) with Chemours contributing 50% (around $592 million), and DuPont (around $400 million) and Corteva (around $193 million) collectively contributing the remaining 50%. The settlement amounts will be funded by the “companies in full and deposited into the water district settlement fund within ten business days following preliminary approval of the settlement by the Court.”
The company stated that the agreement is expected to be finalized in the second quarter of this year and this settlement will be “subject to approval by the United States District Court for the District of South Carolina. As part of the approval process, the Court will establish a timetable for notice to class members, hearings on approval, and for class members to opt out of the settlement. The companies will have the right to terminate the settlement if opt-outs exceed specified levels.”
The above companies are facing lawsuits in the U.S. over their alleged role in polluting drinking water with PFAS or “forever chemicals.”
Analysts are cautiously optimistic about CC stock with a Moderate Buy consensus rating based on three Buys, two Holds, and one Sell.
