Bethesda, MD - June 17, 2002 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today that it has partially exited its investment in subordinated notes issued by IGI Inc., earning a 24% compounded annual return, considering the value of American Capital's remaining equity interest, and has partially exited its subordinated notes issued by Omnova Solutions Inc., earning a 30% compounded annual return.
"American Capital is building an impressive track record of exits, an unambiguous sign of our success in sourcing investment opportunities, conducting rigorous due diligence and timely execution. It is the ultimate measure of our investment strategy and business model," said Chairman, President and CEO Malon Wilkus. "In an economic environment that remains difficult and uncertain, American Capital continues to support strong middle market companies and earn excellent returns for our shareholders."
These are American Capital's eleventh and twelfth exits since its August 1997 IPO. American Capital's blended return for all exits since its IPO is 27%. American Capital's annual return to its shareholders from its IPO through the end of May is 25%, taking into account reinvestment of $8.35 of dividends paid during that period. For a chart detailing all of American Capital's exits, click here.
American Capital invested $7 million in senior subordinated notes with warrants issued by IGI in November, 1999 and an additional $.5 million in June 2000. IGI, a pharmaceutical and consumer products company, sold two of its pet products divisions, triggering a requirement that it repay American Capital's subordinated debt. American Capital retains warrants representing a 17% ownership interest in IGI.
American Capital has invested approximately $8.9 million in subordinated notes issued by Omnova since 2001 in order to support Omnova's acquisition of certain lines of business and assets of Decorative Surfaces International Inc. Omnova has repaid $6.3 million of those subordinated notes.
American Capital is a publicly traded buyout and mezzanine fund with capital resources exceeding $1 billion. American Capital is an equity partner in management and employee buyouts; invests in debt and equity of companies led by private equity firms, and provides capital directly to private and small public companies. American Capital funds growth, acquisitions and recapitalizations. The Company has paid and declared $8.98 per share in dividends
since going public in 1997.
Companies interested in learning more about American Capital's flexible financing and ability to provide senior debt, subordinated debt and equity should contact Mark Opel, Principal, at (800) 248-9340, or visit our website.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 or national economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
