FOR IMMEDIATE RELEASE:
April 11, 2006

Contact
Tom McHale, Senior Vice President, Finance (301) 951-6122
Brian Maney, Director, Corporate Communications (301) 951-6122

American Capital Recognizes $39 Million of Total Net Realized Gain from 9 Exits

Bethesda, MD - April 11, 2006 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today that it has received total proceeds of $268 million from exits and prepayments of nine portfolio companies, realizing a total net gain of $39 million. American Capital earned a positive 48%, 31%, 32%, 25%, 22%, 15%, 18%, 17% and a negative 49% compounded annual rate of return on its exited investments in these companies, including interest, dividends and fees earned over the life of American Capital's exited investments in the companies.

Network for Medical Communication & Research LLC
In the first quarter of 2006, American Capital realized a gain, net of tax, of $21 million from the sale of its portfolio company Network for Communication & Research LLC to AmerisourceBergen Corporation. NMCR is a provider of specialized medical educational programs, research and content for physicians and other medical personnel. American Capital recognized total proceeds of $33 million upon the exit, earning a 48% compounded annual rate of return on its investment, including interest, dividends and fees earned over the life of American Capitals investment. The proceeds received by American Capital were less than the fourth quarter 2005 valuation of the investment by $2.4 million, or 7%.

In January 2002, American Capital invested $22 million in senior debt and senior and junior subordinated debt with warrants to acquire an interest in NMCR. In 2002, NMCR repaid its $3 million of senior debt.

"NMCR has a market-leading reputation for excellence in the delivery medical education and market research programs. We are proud of what the NMCR management team and physician partners have been able to accomplish and are delighted to have been a part of the company's growth," said American Capital Regional Managing Director Darin Winn.

For more information about the NMCR transaction, click here.

3SI Acquisition Holdings Inc.
In the first quarter of 2006, American Capital realized a gain of $27 million from the sale of its portfolio company 3SI Acquisition Holdings Inc. to Stirling Square Capital Partners. 3SI is a leading global provider of security solutions utilizing dye-based staining solutions and wireless tracking devices to protect currency from theft in banks, ATMs, safes and transport applications. American Capital recognized total proceeds of $93 million upon the exit, earning a 31% compounded annual rate of return on its investment, including interest and fees earned over the life of American Capitals investment. The proceeds received by American Capital were less than the fourth quarter 2005 valuation of the investment by $1.4 million, or 1%.

In July 2002, American Capital invested $13 million in 3SI, supporting Lincolnshire Equity Fund II's acquisition. In December 2003, American Capital sponsored a buyout of 3SI from Lincolnshire, with $58 million of funds from American Capital. In September 2004, American Capital invested a subsequent $7 million to support 3SI's acquisition of the assets of U.S. Currency Protection Corp., a designer, manufacturer and supplier of wireless tracking devices and dye-packs used to protect and recover cash from bank robberies.

"Our cumulative investments in 3SI have produced a wonderful outcome for American Capital," said American Capital Managing Director Frank Do. "We were very pleased to have worked with 3SI's excellent management over the years, both as a minority investor and then as a majority investor."

For more information about the 3SI transactions, click here.

Edge Products LLC
In the first quarter of 2006, American Capital and an affiliate realized a gain, net of taxes, of $4 million from the sale of its portfolio company Edge Products LLC. Edge Products is a leading designer and manufacturer of performance related automotive aftermarket parts. American Capital recognized total proceeds of $30 million upon the exit, earning a 32% compounded annual rate of return on its investment, including interest and fees earned over the life of American Capitals investment. The proceeds received by American Capital were greater than the fourth quarter 2005 valuation of the investment by $1.8 million, or 6%.

In March 2005, American Capital invested $30 million in a revolving credit facility, senior term loan, senior subordinated debt, junior subordinated debt and common equity in Edge Products.

"We're delighted to have worked closely with Edge's high caliber founding owners and management team throughout our investment. Edge's management team has been successful at leveraging the Company's competitive advantages and we wish them continued success in the coming years," said American Capital Managing Director Frank Do.

For more information about the Edge Products transaction, click here.

Alemite Holdings LP
In the first quarter of 2006, an affiliate of American Capital realized a gain, net of taxes, of $2 million from the sale of Alemite Holdings LP. Alemite is a leading manufacturer of high-quality lubrication equipment, including pumps and reels, grease guns, grease fittings and automatic lubrication devices, serving hundreds of industrial customers as well as consumer automotive customers. American Capital recognized total proceeds of $2 million upon the exit, earning a 25% compounded annual rate of return on its investment, including interest and fees earned over the life of American Capitals investment. The proceeds received by American Capital were less than the fourth quarter 2005 valuation of the investment by $0.3 million, or 10%.

In June 2002, American Capital invested $10 million in senior subordinated debt with warrants in Alemite to finance partially Sentinel Capital's acquisition of Alemite from Invensys plc, a publicly traded British concern. In July 2004, American Capital was repaid its $10 million senior subordinated debt investment in Alemite.

"We are happy to have been able to work with Sentinel Capital and Alemite, assisting in the companys spin off from its corporate parent and establishing it on a solid footing as an independent company," said American Capital Principal Adam Spence.

For more information about the Alemite transactions, click here.

NewQuest Inc.
In the first quarter of 2006, American Capital received proceeds of $36 million for the full repayment of its subordinated debt investment in NewQuest Inc, a wholly-owned subsidiary of HealthSpring Inc. (NYSE:HS). NewQuest is an independent managed care organization primarily focused on providing Medicare Advantage HMO health plans to members in Alabama, Illinois, Tennessee and Texas. American Capital earned a 22% compounded annual rate of return on its investment, including interest and fees earned over the life of American Capitals investment.

In March 2005, American Capital invested $35 million in senior subordinated debt of NewQuest, supporting GTCR Golder Rauner LLCs recapitalization.

"Our investment in NewQuest was an excellent opportunity for us to have expanded our relationship with GTCR, a sponsor with extensive experience in the healthcare industry," said American Capital Principal Demian Kircher.

For more information about the NewQuest transaction, click here.

Technical Concepts Holdings LLC
In the first quarter of 2006, American Capital received proceeds of $28 million for the full repayment of its senior and subordinated debt investments in Technical Concepts Holdings LLC, a global designer and marketer of "touch-free" automated products and other related products and services for hygiene and odor control in "away from home" restrooms. American Capital continues to own warrants to purchase a minority equity interest in Technical Concepts. American Capital realized a gain of $1 million on the repayment of its debt investment, earning a 15% compounded annual rate of return on its debt investments, including interest and fees earned over the life of American Capitals debt investments.

In February 2003, American Capital invested $33.5 million in senior term notes and senior and junior subordinated debt with warrants in Technical Concepts, supporting Liberty Partners acquisition.

"We were delighted to have worked alongside Liberty Partners in their 2003 acquisition of Technical Concepts. Technical Concepts is a global leader in automated top quality restroom equipment, supported by a highly regarded management team dedicated to constant product innovation," said American Capital Principal Sean Eagle.

For more information about the Technical Concepts transaction, click here.

Vector Products Inc.
In the first quarter of 2006, American Capital received proceeds of $35 million for the full repayment of its senior debt investment in Vector Products Inc, a leading designer, developer, producer and marketer of portable power products for consumers in the automotive, marine, home and consumer electronics markets. American Capital earned an 18% compounded annual rate of return on its investment, including interest and fees earned over the life of American Capitals investment.

In September 2005, American Capital invested $35 million in the senior term B debt of Vector.

"We're pleased to have partnered with Vector's management team to support their growth initiatives and entrance into new consumer market categories," said American Capital Principal Steve Martinez.

For more information about the Vector transaction, click here.

Beacon Hospice Inc.
In the first quarter of 2006, American Capital received proceeds of $11 million for its full repayment of its senior debt investments in Beacon Hospice Inc, a leading provider of hospice services in New England. American Capital earned a 17% compounded annual rate of return on its senior debt investment, including interest and fees earned over the life of American Capitals investment. American Capital continues to hold a subordinated debt investment in Beacon.

In February 2005, American Capital invested $24 million in the revolving credit facility, senior term loan B and senior subordinated debt of Beacon, supporting Halpern Denny & Co.s acquisition.

"American Capitals investment in Beacon has been an excellent opportunity to invest with Halpern Denny, a new private equity relationship for American Capital, and support a leading hospice provider in the New England region," said American Capital Managing Director Jon Isaacson.

For more information about the Beacon transaction, click here.

American Decorative Surfaces Inc.
In the first quarter of 2006, American Capital realized a loss of $16 million from its investment in portfolio company American Decorative Surfaces Inc. American Decorative Surfaces was a manufacturer of decorative paper and vinyl surfacing materials. American Decorative Surfaces ceased business operations and a receiver has been appointed to liquidate its remaining assets and wind up its affairs. Although American Capital is pursuing its claims in the receivership, American Capital does not presently expect to receive any additional proceeds from the liquidation and has determined that its remaining debt investment and equity investment are worthless resulting in the recognition of a realized loss. American Capital has earned a negative 49% compounded annual rate of return on its investment, including interest and fees earned over the life of American Capitals investment.

In May 2002, American Capital invested $38 million in subordinated debt and equity in American Decorative Surfaces, which used the proceeds to purchase certain assets of Decorative Surfaces International Inc., in a sale conducted under Section 363 of the Bankruptcy Code. In 2005, American Capital sold a portion of its debt and equity investments in American Decorative Surfaces for nominal consideration, realizing a loss of $23 million.

For more information about the American Decorative Surfaces transaction, click here.

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From its IPO through the fourth quarter of 2005, American Capital has earned a 17% compounded annual return on 118 exits and prepayments of senior debt, subordinated debt and equity investments, totaling $2.6 billion of invested capital, including interest, dividends, fees and net gains on these investments. These exits and prepayments represent 30% of all amounts invested by American Capital since its August 1997 IPO.

For a chart showing American Capitals realized gains as of the end of Q4 2005, click here.

For a chart showing American Capitals exited portfolio companies, click here.

ABOUT AMERICAN CAPITAL
American Capital is a publicly traded buyout and mezzanine fund with capital resources of approximately $7.7 billion.  American Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts, provides capital directly to early stage and mature 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, recapitalizations and securitizations.  American Capital can invest up to $300 million per company.

As of March 31, 2006, American Capital shareholders have enjoyed a total return of 410% since the Company's IPO - an annualized return of 21%, assuming reinvestment of dividends.  American Capital has paid a total of $1 billion in dividends and paid $19.91 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.