ABS Moving On Up and Out

Deutsche Bank is continuing its rapid retreat from private equity. The latest leap involves ABS Ventures, a onetime venture capital affiliate of Alex. Brown that later would feature Deutsche as its sole limited partner.

Deutsche is close to selling off its limited partner stakes in ABS Ventures to Adams Street Partners and Pomona Capital in a secondary market deal valued at between $43 million and $63 million.

Following the transaction, ABS Ventures will continue to operate as an independent firm, but does not expect to raise a new fund nor add new portfolio companies for at least the next 12 months.

“There are two types of secondary purchases,” says Gregory Garrett, a partner with Adams Street Capital. “One is just to purchase an interest in an existing partnership, and the other is to purchase a portfolio of existing investments and wrap a new partnership around it.”

The ABS Ventures deal is more an example of the latter, as the firm has shifted its headquarters from Baltimore to Boston and added former DB Capital Partners investor Bill Burgess as a full-time managing director.

It also does not plan to relaunch its health-care investment practice, which was effectively closed earlier this year when Jim Shapiro, Dick Spalding and Casey Castelein all left ABS Ventures to launch a new health-care venture fund for Thomas Weisel Partners (See PE Week, 4/28/2003).

Bruns Grayson, managing partner of ABS Ventures, did not answer calls requesting comment for this story. A source familiar with the situation, however, said that the firm’s geographic uprooting was largely precipitated by Grayson’s personal decision to move north. Nonetheless, ABS Ventures plans to maintain a personnel presence in Baltimore, New York and London.