Bridgewater Sells Stakes To Institutional Investors

Feb 21 2012 | 1:30am ET

Two institutional investors have bought stakes in the world's largest hedge fund, Bridgewater Associates.

The Teacher Retirement System of Texas bought a non-voting stake in Bridgewater for $250 million. The purchase, the first direct investment in an asset manager by the $109 billion public pension, was approved by its board of trustees on Thursday.

Another institutional investor, which Bridgewater would not identify, has also taken a stake in the manager. The hedge fund also refused to say how much the second new shareholder had invested. The firm did say that it is in advanced talks with another institutional investor about buying a stake.

TRS and the two unidentified institutions are investors in Bridgewater's fund. In addition, TRS chief investment officer T. Britton Harris briefly served as CEO of the hedge fund in 2005.

The stake sales were first reported by Pensions & Investments.

Bridgewater, which manages $120 billion, has been working to cut founder Ray Dalio's stake in the company. On Friday, Robert Prince, Bridgewater's co-CIO, told investors that Dalio has sold about 20% of his Bridgewater shares to the firm and key employees, among them Prince himself and fellow co-CIO Greg Jensen. Bridgewater has also "very selectively" approached a handful of its institutional clients about becoming shareholders. The firm hopes to reduce Dalio's stake to between 10% and 20% within 10 years, creating "a company that is employee-owned and employee-controlled," Prince wrote.

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