FOR IMMEDIATE RELEASE:
August 9, 2007

Contact
John Erickson, Chief Financial Officer (301) 951-6122

AMERICAN CAPITAL APPOINTS JOEL HOUCK MANAGING DIRECTOR TO HEAD NEW FUND

Bethesda, MD – July 19, 2007 – American Capital Strategies Ltd. (Nasdaq: ACAS) announced today that Joel Houck has joined the Company as a Senior Vice President and Managing Director. Mr. Houck joins American Capital from Wachovia Capital Markets LLC where he served as a senior equity analyst and covered companies in the specialty finance sector since 2002. In his new position, Mr. Houck will be responsible for developing a new closed-end fund, which would be managed by an affiliate of American Capital.

“We are extremely delighted that Joel is joining American Capital. Joel has been following American Capital for the past seven years at both Wachovia and A.G. Edwards and his profound knowledge of our organization and operations coupled with his expertise in specialty finance and commercial banking make him the ideal candidate to develop a new fund,” said Malon Wilkus, American Capital Chairman, Chief Executive Officer and President. “We believe that he will play a key role as we further develop and expand American Capital’s asset management business.”

“As a leading private equity fund and alternative asset manager, American Capital is continuously searching for compelling investment opportunities in numerous industry verticals,” said Joel Houck. “I am pleased to join American Capital at such an exciting time and look forward to working closely with my new colleagues to identify new opportunities and build on the Company’s asset management strategy.”

Prior to Wachovia, Mr. Houck worked for A.G. Edwards & Sons Inc. as a senior equity analyst, where he established research coverage of the specialty finance sector. He came to A.G. Edwards after six years in the commercial banking industry, when he worked as a credit and commercial loan officer for NationsBank Corp. (formerly Boatmen’s Bancshares) and PNC Bank Corp. Mr. Houck was recognized six times in the annual Wall Street Journal poll "Best on the Street" published in 2000, 2001, 2002, 2004, 2005 and 2006. He was also ranked the number 1 stock picker in his sector in both 2000 and 2001.

Mr. Houck is a Chartered Financial Analyst and holds a B.S. in mathematics and statistics and an M.B.A. in finance from Miami University in Oxford, OH.

ABOUT AMERICAN CAPITAL

American Capital is the only alternative asset management company that is a member of the S&P 500. With $16 billion in assets under management ¹, American Capital is the largest U.S. publicly traded private equity fund and one of the largest publicly traded alternative asset managers.  American Capital, both directly and through its global asset management business, is an investor in management and employee buyouts, private equity buyouts, and early stage and mature private and public companies.  American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalizations and securitizations.  American Capital and its affiliates invest from $5 million to $800 million per company in North America and €5 million to €500 million per company in Europe.

As of July 31, 2007, American Capital shareholders have enjoyed a total return of 505% since the Company's IPO - an annualized return of 20%, assuming reinvestment of dividends.  American Capital has paid a total of $1.7 billion in dividends and paid or declared $25.16 dividends per share since going public in August 1997 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 www.AmericanCapital.com or www.EuropeanCapital.com.

¹Includes American Capital’s investment in externally managed funds.

This press release contains forward-looking statements. The statements regarding expected results of American Capital 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.