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Bridgewater Announces Move to Partnership Structure

The transition will give employees more control and ownership of the hedge fund firm, but will not immediately affect the role of founder Ray Dalio.

The world’s largest hedge fund, Bridgewater Associates, will adopt a partnership structure, the firm announced to its employees and investors on Thursday. 

The move marks the next step in the hedge fund firm’s long-term leadership transition process. Its founder, Ray Dalio, has already stepped backed from day-to-day management of the company, having announced in March 2017 that he was stepping down as the co-CEO of the firm. Dalio remains co-CIO and co-chairman, and has no immediate plans to step back further, according to a source familiar with the matter.

[II Deep Dive: Bridgewater Associates CFO Exits]

The transition into a partnership will give employees more control and ownership of the hedge fund firm. Prior to this, several key employees at the firm had “phantom equity ownership.” The partnership structure will make these employees partially responsible for the governance of the firm, in addition to having economic ownership of the company, according to the source. 

Dalio and his co-chief investment officers, Bob Prince and Greg Jensen, have additionally selected a small group of “seed partners,” as well as another group of provisional partners, to determine the functions, members, and responsibilities of the partnership. The employee partners are expected to elect three members to Bridgewater’s board of directors, the source said. She described the move as “very much a work in progress.” 

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