Gramercy Funds Management Reaches Major Settlement with Peru

Gramercy Funds Management Reaches Settlement with the Republic of Peru

In recent news, Gramercy Funds Management LLC, along with Gramercy Peru Holdings LLC, collectively known as Gramercy, has successfully settled an international arbitration award with the Republic of Peru. This settlement resolves significant disputes stemming from Gramercy's investment in Peruvian agrarian reform bonds, valued at approximately 9,600 bonds. The issues were brought to arbitration under the United States–Peru Trade Promotion Agreement, emphasizing the importance of international treaties in protecting investors’ rights.

The Arbitration Process and Its Outcomes

This arbitration, designated ICSID Case No. UNCT/18/2, was a notable undertaking that culminated in a ruling dated December 6, 2022. This ruling demanded that Peru pay Gramercy damages alongside costs related to the investment. To further complicate matters, the award included a stipulation for compound interest on the primary financial award at an annual rate of 7.22%. The decision marked a significant moment in the landscape of investment protections provided under international law.

Settlement Agreement Details

Under the terms set out in the newly reached agreement, the Republic of Peru will remit a total of $85 million to Gramercy. The process commenced with an initial payment of $45 million, executed on a mutually agreed date, while the remaining balance will be settled based on a structured payment plan established by the parties. This plan is further elaborated in the Stipulated Judgment documented in the D.C. District Court, where proceedings were initiated to ensure enforcement of the award.

Gramercy's Position on the Settlement

Expressing their satisfaction with the outcome, Gramercy stated that they are pleased the constructive dialogue resulted in a resolution that benefits both, the firm and its investors. This amicable settlement underscores Gramercy’s commitment to enhancing its stakeholder relationships and maintaining transparency throughout the investment process.

About Gramercy Funds Management

Based in Greenwich, Connecticut, Gramercy is a prominent player in the global emerging markets investment scene. With an impressive $6 billion in assets under management, Gramercy has established offices in key locations including London, Buenos Aires, Miami, West Palm Beach, and Mexico City. Founded in 1998, the firm aims to furnish investors with a more effective approach to navigate emerging markets. The firm is dedicated to delivering attractive risk-adjusted returns while ensuring a robust and transparent institutional platform.

Investment Strategies Offered

Gramercy provides a variety of investment strategies across emerging market asset classes. These include multi-asset options, private credit, public credit, and special situations, thereby catering to the diverse requirements of their clientele. Their mission extends beyond mere financial returns, aiming to positively influence the well-being of clients, their portfolio investments, and their team members.

Commitment to Responsible Investing

As a Registered Investment Adviser recognized by the U.S. Securities and Exchange Commission, Gramercy holds itself to high standards of responsible investing. The firm is proud to be a Signatory of the Principles for Responsible Investment and the Net Zero Asset Managers initiative. Additionally, they support the Task Force on Climate-Related Financial Disclosures, showcasing their dedication to sustainability and ethical investment practices.

Client Engagement and Transparency

Through its operations, Gramercy seeks to establish a transparent relationship with clients, fostering an environment where investor interests are prioritized. As markets continue to evolve, Gramercy stands ready to adapt and innovate, ensuring they remain at the forefront of investment management.

Frequently Asked Questions

What is the significance of the settlement between Gramercy and Peru?

The settlement resolves a major arbitration award, allowing Gramercy to secure $85 million while reinforcing the protection of investor rights under international agreements.

How much did Gramercy initially receive from Peru?

Gramercy received an initial payment of $45 million as part of the settlement agreement with Peru.

What does Gramercy specialize in?

Gramercy specializes in emerging markets investments, offering various strategies that prioritize risk-adjusted returns for investors.

Where are Gramercy’s offices located?

Gramercy has offices in Greenwich, London, Buenos Aires, Miami, West Palm Beach, and Mexico City, enhancing their global reach.

How does Gramercy approach responsible investing?

Gramercy is committed to responsible investing and holds membership in several sustainability initiatives to promote ethical practices in finance.

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