FOR IMMEDIATE RELEASE:
June 29, 2005

Contact
Brian Graff, Regional Managing Director (212) 213-2009
Adam Spence, Vice President (212) 213-2009
Brian Maney, Director, Corporate Communications (301) 951-6122

American Capital Invests $55 Million in Add-on Acquisition for Portfolio Company Specialty Brands of America

Bethesda, MD - June 29, 2005 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today it has invested $55 million in the add-on acquisition of Bear Creek Country Kitchens LLC by its portfolio company Specialty Brands of America Inc., a leading branded specialty foods company. Bear Creek is a leading manufacturer and marketer of dry soups and soup bases. American Capital's investment takes the form of senior term loans, senior and junior subordinated debt and convertible preferred equity. American Capital is also providing a revolving credit facility.

"American Capital is committed to supporting the growth of our portfolio companies by strategic acquisitions," said American Capital COO Ira Wagner. "We are delighted to invest in the acquisition of Bear Creek, fully integrating it with our outstanding portfolio company Specialty Brands while maintaining its brand and high quality appeal. Bear Creek is a great addition for Specialty Brands, further diversifying Specialty Brands' product line and solidifying its leading position in the retail food industry."

American Capital has invested over $2.5 billion in the last twelve months, over $1.2 billion year to date and over $870 million quarter to date. For more information about American Capital's portfolio click here.

"We are pleased to support Specialty Brands' strategic acquisition of Bear Creek, a unique national brand in the large and stable U.S. soup market. Bear Creek holds the number one position in the hearty dry soup segment and holds a strong leadership position in the overall dry soup category," said American Capital Managing Director Brain Graff. "Bear Creek's strong performance in the market stems from significant gains in distribution and velocity. Bear Creek soups are known for their superior taste, quality ingredients, distinguished dry packaging and premium price positioning, which generates attractive sales for its retail customers."

"Specialty Brands has an excellent track record of successful acquisitions and integrations and we believe that it will rapidly and effectively complete this integration," said American Capital Vice President Adam Spence. "The combination of Bear Creek and Specialty Brands is expected to result in significant synergies, including leveraging strong selling relationships and enhancing distribution efficiencies."

Founded in 1991, Heber City, UT-based Bear Creek is the second largest manufacturer and marketer of dry soups and soup bases in the U.S. Bear Creek offers a range of packaged food products including hearty dry soups, ready-to-serve soups and culinary bases under the Bear Creek® brand. The Company also sells soups, dips and smoothies under the Sheila's Select® brand, and gourmet salsas, pickled vegetables and gourmet jellies under the Cherith Valley® brand. Bear Creek's products are sold in over 30,000 stores nationwide, including retail stores, club stores, dollar stores, specialty food outlets, gift shops and military and mass market channels. Customers include Costco, Kehe Food Distributors, Kroger, Wal-Mart and Safeway.

In December 2003, American Capital invested $68 million in the buyout of Specialty Brands of America. American Capital's investment took the form of a revolving credit facility, senior term debt, senior and junior subordinated debt and redeemable preferred and common equity. Founded in 1991 and based in Westbury, NY, Specialty Brands has built a leading branded specialty foods company through acquisitions and internal growth. Specialty Brands is the leading marketer of maple syrup and sugar free syrups worldwide, with the Spring Tree®, Cary's®, and MacDonalds™ brands. Specialty Brands' syrups can be found in the U.S. in just about every grocery store, in leading breakfast restaurant chains and in 18 countries. Specialty Brands also markets Original Trenton Crackers®, Dixie Fry® Coating Mix, New York Flatbreads®, and Canoleo® Margarine. The Company's customers include all of the leading retailers and wholesalers in the U.S.

"We are excited about the Bear Creek acquisition, which expands our product offering and provides our consumers with more appetizing, yet easily prepared specialty foods," said Specialty Brands of America founder and CEO Dom Bastien. "Since partnering with American Capital in December of 2003, we've worked extremely well together, growing Specialty Brands. We were confident that we could count on American Capital in this acquisition and truly appreciate the non-stop support they give."

For more information about Specialty Brands' line of delicious specialty foods click here.

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.

This announcement is neither an offer to sell nor a solicitation to buy securities.
This announcement appears as a matter of record only.