FOR IMMEDIATE RELEASE:
June 24, 2005

Contact
Robert Klein, Managing Director (212) 213-2009
Dale Stohr, Principal (212) 213-2009
Brian Maney, Director, Corporate Communications (301) 951-6122

AMERICAN CAPITAL INVESTS $30 MILLION IN BUYOUT OF NPC

Bethesda, MD - June 24, 2005 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today it has invested $30 million in the buyout of NPC Inc., the leading designer and manufacturer of flexible, rubber pipe-to-manhole connectors for sanitary sewer, stormwater and drainage systems. American Capital's investment takes the form of a senior term C loan, senior subordinated debt and equity. American Capital is also providing a revolving credit facility. NPC management is investing in equity alongside American Capital. Post close, American Capital owns approximately 89% of NPC, on a fully diluted basis.

"NPC is representative of the type of company that American Capital looks to invest in: it is the leading player in a small market with strong cash flows, excellent industry fundamentals, and multiple end product and market growth opportunities," said American Capital COO Ira Wagner. "It is our ninth buyout of 2005."

American Capital has invested over $2.5 billion in the last twelve months, over $1.2 billion year to date and $840 million quarter to date. For more information about American Capital's portfolio click here.

"NPC is well known for its superior product quality, consistency and performance, as well as timely delivery response and excellent customer service," said American Capital Principal Dale Stohr. "Its products are critical to the sanitary sewer infrastructure and will benefit from increasing adoption in stormwater systems. NPC will also benefit as municipalities strive to meet the rapidly growing need to rehabilitate their aging sewer infrastructure."

"American Capital is backing a management team with substantial market experience, strong customer relationships and a history of success. We look forward to working with them," said American Capital Managing Director Robert Klein.

NPC's flexible connectors, or "Boots", create a watertight seal between inlet and outlet pipes and concrete manholes, preventing leakage and ground water infiltration while allowing for movement due to ground settling, shifting and vibration. NPC's products are sold to a diversified customer base of more than 300 concrete precasters, who produce manholes, box culverts, storm-drain structures and septic tanks. The Company has built its market leading position and brand awareness through a 30 year history of serving precasters. In addition to its core connectors business, the Company manufactures a broad product line of specialized equipment and products used in producing, testing and repairing manholes and pipes. These products include chimney seals and internal joint seals for manhole and pipe repair, targeting the growing market for rehabilitation products for North America's decaying sewer infrastructure. NPC operates from three facilities, two in Milford, New Hampshire and one in Park Hills, Missouri. The Company has a history of stable and consistent financials.

For more information about NPC's line of essential components for wastewater and drainage systems click here.

"We are excited about partnering with American Capital for the next phase of our Company's growth," said NPC CEO Randy Snyder. "The strategic and financial resources they bring to the table will help us implement our vision for the Company."

ABOUT AMERICAN CAPITAL

American Capital is a publicly traded buyout and mezzanine fund with capital resources of approximately $5.4 billion. American Capital invests in and sponsors 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 May 31, 2005, American Capital shareholders have enjoyed a total return of 364% since the Company's IPO - an annualized return of 22%, assuming reinvestment of dividends. American Capital outperformed 86%, 72%, 85% and 91% of all U.S. public companies with a current market capitalization greater than $1 billion^* in the one-year, three-years, five-years and the approximately seven and a half years since the IPO, in each case ending May 31, 2005. American Capital has paid a total of $717 million in dividends and paid or declared $17.51 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.

^*Figures were updated on June 28, 2005

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.