FOR IMMEDIATE RELEASE:
March 3, 2005

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

AMERICAN CAPITAL ISSUED $100 MILLION UNSECURED CREDIT FACILITY BY BB&T;
CREDIT FACILITY INCREASED TO $1 BILLION BY CITIGROUP AFFILIATE

Bethesda, MD - March 3, 2005 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today that BB&T Capital Markets has arranged a $100 million unsecured revolving credit facility with Branch Banking and Trust Company as agent for a syndicate of lenders, replacing American Capital's previous $70 million secured credit facility. In addition, Citigroup Global Markets Realty Corp. ("CGMRC"), an affiliate of Citigroup Inc., increased the amount available under one of American Capital's revolving credit facilities to $250 million from $100 million, resulting in a total capacity of $1 billion for that credit facility. Affiliates of Wachovia Bank N.A. are the agent of the facility and a participating lender. Other lenders in American Capital's revolving credit facility are JPMorgan Chase Bank and a Bank of America administered Asset Backed Commercial Paper conduit.

"American Capital has raised $2.8 billion of debt capital since 1999," said Tom McHale, American Capital Vice President of Finance and Investor Relations. "American Capital now has $1.2 billion of capacity from its combined revolving facilities, has issued $1.4 billion in notes through six term securitizations over the past five years and issued $167 million of unsecured term notes in 2004. Our capital resources have greatly expanded and diversified during the past two years and remain a tremendous competitive advantage."

American Capital had the following amounts outstanding under each term debt issuance and credit facility as of February 20, 2005:

AMERICAN CAPITAL DEBT CAPACITY (000)

ABOUT AMERICAN CAPITAL

American Capital is a publicly traded buyout and mezzanine fund with capital resources of more than $4.9 billion. American Capital is an investor in and sponsor of management and employee buyouts, invests in private equity buyouts, and provides capital directly to private and small public companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions and recapitalizations.

As of February 28, 2005, American Capital shareholders have enjoyed a total return of 348% since the Company's IPO - an annualized return of 22%, assuming reinvestment of dividends. American Capital has paid a total of $651 million in dividends and paid or declared $16.76 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.