(Bloomberg) - An investment partnership between Ray Dalio’s family office and Abu Dhabi royal Sheikh Tahnoon bin Zayed Al Nahyan has been delayed as Bridgewater Associates grapples with the legal terms of its billionaire founder’s exit from the firm.
One of the questions is whether Dalio, who built Bridgewater into a $160 billion behemoth, might use the company’s intellectual property if he proceeds with the tie-up, according to people with direct knowledge of the matter.
The 74-year-old signed a non-compete agreement upon departing the world’s largest hedge fund several years ago, the people said, requesting anonymity as the matter is private. Dalio’s planned venture with Sheikh Tahnoon, one of Bridgewater’s top clients, will put that contract under the microscope, they said.
“Bridgewater and Ray have both communicated that there have been no discussions or conflicts between Ray and Bridgewater on those topics, and that anything suggesting otherwise is completely false,” Dalio and Bridgewater said in a statement. “Bridgewater does not comment on its client partnerships, past or present.”
The American investor and Emirati royal were planning to launch the partnership in the middle of last year, according to people familiar with the matter. They’ve been looking to team up on an asset management arm based within Abu Dhabi’s international financial center for G42, the artificial intelligence firm set up by Sheikh Tahnoon, the people said.
Dalio could potentially manage some of the money for a fee, they said, though he has been providing informal advice in the interim.
Representatives for the Dalio Family Office didn’t respond to requests for comment. A G42 spokesperson confirmed that the firm and the DFO are exploring ways of cooperating, though they’ve yet to enter any formal business collaboration.
Dalio has been the face of Abu Dhabi’s recent success in drawing hedge fund luminaries and set up a branch of his personal investment firm in the emirate last year. That’s part of a broader collaboration with Sheikh Tahnoon — the money man for the world’s richest family. Abu Dhabi Investment Authority, now chaired by the royal, was one of Bridgewater’s top backers when Dalio started the firm half a century ago.
While a formal launch of the DFO-G42 partnership has stalled, several employees have moved between the two companies.
Among them is Ali Hegazi, who recently joined Dalio’s family office in Abu Dhabi as director of investment research and strategy following previous stints at G42 and ADIA, according to people familiar with the matter.
G42, which has ambitions to become an AI superpower in the Middle East, has faced scrutiny on some of its investments. Earlier this year, its chief executive pledged to turn away from China in favor of the US. A new investment vehicle in Abu Dhabi recently took over the management of the company’s China-focused fund, keeping the assets in the hands of Sheikh Tahnoon, Bloomberg News has reported.
Dalio and G42 have already teamed up in the environmental space, working on oceanic research as part of a project aimed at protecting Indonesia’s marine ecosystem.
By Ben Bartenstein
With assistance from Nishant Kumar and Katherine Burton
