ACAS American Capital, Ltd.

BETHESDA, Md., Dec. 7 /PRNewswire-FirstCall/ -- American Capital Strategies Ltd. (NASDAQ:ACAS) announced today that it has received total proceeds of $221 million from exits and prepayments of five portfolio companies, realizing a total net gain of $56 million. American Capital earned an 18%, 14%, 29% and 71% compounded annual rate of return on its investments in these companies, including the realized gains, interest, dividends and fees earned over the life of American Capital's investment in the companies. Dynisco Parent Inc. In the fourth quarter of 2005, American Capital received full repayment of its $28 million subordinated debt investments in Dynisco Parent Inc. Dynisco is a global manufacturer of branded test, measurement and process control devices for the plastics industry. American Capital realized a gain of $0.5 million on the prepayment of the debt, earning an 18% compounded annual rate of return on its debt investment. American Capital continues to own a common equity interest in Dynisco. In July 2004, American Capital invested $15 million in senior subordinated debt and junior subordinated debt with warrants in Dynisco, supporting Audax Private Equity's acquisition. In September 2004, American Capital made a subsequent $14 million investment in Dynisco to support the company's acquisition of Alpha Technologies US LP, the leading global designer and manufacturer of precision instruments and software for the rubber processing industry. American Capital's additional investment took the form of senior subordinated debt, intermediate subordinated debt with warrants and common equity. For more information about the Dynisco transactions, go to http://www.acas.com/our_portfolio/companies/company.cfm?p_comp=148 Erickson Construction LLC In the fourth quarter of 2005, American Capital received full repayment of its remaining $40 million senior term B loan to Erickson Construction LLC, a cost-effective manufacturer of panelized building components for the homebuilding industry. American Capital received proceeds of $26 million for the final repayment in the fourth quarter and had received prepayments of $14 million earlier in 2005. In September 2004, American Capital invested $40 million in the form of a senior term B loan to Erickson Construction in support of a private equity firm's acquisition of the company. For more information about the Erickson Construction transaction, go to http://www.acas.com/our_portfolio/companies/company.cfm?p_comp=162. Vigo Remittance Corp. In the fourth quarter of 2005, American Capital sold its remaining common stock warrant investment in GMT Group, Inc., the parent of Vigo Remittance Corp., for $5 million to First Data Corporation, resulting in a realized gain of $4 million. Vigo is the largest privately held worldwide electronic funds transfer service firm. The amount realized by American Capital approximated the third quarter 2005 valuation of the investment. In March 2003, American Capital invested $50 million in the form of senior debt and senior subordinated debt with warrants, supporting the acquisition of Vigo in a management led buyout in partnership with Great Hill Partners. In June 2004, American Capital was repaid the balance of its $50 million senior debt and senior subordinated debt investment in Vigo. For more information about the Vigo transaction, go to http://www.acas.com/our_portfolio/companies/company.cfm?p_comp=93 Other Company Exit and Repayments In the fourth quarter of 2005, American Capital has realized a gain of $51 million from the sale of a portfolio company. American Capital recognized total proceeds of $88 million upon the exit. The amount realized by American Capital was less than the third quarter 2005 valuation of the investment by $0.6 million, or less than 1%. In the fourth quarter of 2005, American Capital also sold its senior term A and B debt investments and revolving credit facility in another portfolio company for $74 million, which approximated its cost basis. American Capital's net realized portfolio gains (excluding interest rate derivative agreements) year-to-date through the third quarter of 2005 totals $40 million. From its IPO through the third quarter of 2005, American Capital has earned an 18% compounded annual return on 106 exits and prepayments of senior debt, subordinated debt and equity investments, totaling $2.0 billion of invested capital, including interest, dividends, fees and net gains on these investments. These exits and prepayments represent 27% of all amounts invested by American Capital since its August 1997 IPO. For a chart showing American Capital's realized gains as of the end of Q3 2005, go to: http://www.acas.com/investor_relations/realized_gains.cfm. For a chart showing American Capital's exited portfolio companies, go to: http://www.acas.com/our_portfolio/exited_companies.cfm. ABOUT AMERICAN CAPITAL American Capital is a publicly traded buyout and mezzanine fund with capital resources of approximately $7 billion. American Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts, and provides capital directly to private and small public companies and through its asset management business is a manager of debt and equity investments in private companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions and recapitalizations. As of November 30, 2005, American Capital shareholders have enjoyed a total return of 431% since the Company's IPO -- an annualized return of 22%, assuming reinvestment of dividends. American Capital has paid a total of $868 million in dividends and paid or declared $19.08 dividends per share since its August 1997 IPO at $15 per share. Companies interested in learning more about American Capital's flexible financing should contact Mark Opel, Senior Vice President, Business Development, at (800) 248-9340, or visit our website. Performance data quoted above represents past performance of American Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in American Capital will likely fluctuate. Consequently, an investor's shares, when sold, may be worth more or less than their original cost. Additionally, American Capital's current performance may be lower or higher than the performance data quoted above. This press release contains forward-looking statements. The statements regarding expected results of American Capital Strategies are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, or changes in the conditions of the industries in which American Capital has made investments. DATASOURCE: American Capital Strategies Ltd. CONTACT: Tom McHale, Vice President, Finance and Investor Relations, or Brian Maney, Director, Corporate Communications, of American Capital Strategies Ltd., +1-301-951-6122 Web site: http://www.americancapital.com/

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