FOR IMMEDIATE RELEASE:

August 18, 2006

Contact
Bowen Diehl , Principal (214) 273-6632
Kyle Bradford, Vice President (214) 273-6637
Brian Maney, Director, Corporate Communications (301) 951-6122

American Capital Invests in One Stop Buyout™ of Scientific Protein Laboratories

Bethesda, MD – August 18, 2006 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today it has invested in the One Stop Buyout™ of Scientific Protein Laboratories LLC (SPL), a leading global independent manufacturer and supplier of biologic active pharmaceutical ingredients (APIs).  American Capital’s investment takes the form of a senior term A loan, a senior second lien loan, senior and junior subordinated debt and equity.  American Capital is also providing a revolving credit facility.  SPL management is also investing in equity.  Post close, American Capital owns approximately 87% of the Company on a fully diluted basis.  SPL was previously owned by Arsenal Capital Partners, SPL management and other investors. 

“We are delighted to be investing in the One Stop Buyout™ of SPL and supporting a world class management team, who has established a strong global market position,” said American Capital Regional Managing Director Darin Winn.  “Our outstanding capabilities in investing throughout the capital structure and in responding rapidly with flexibility have contributed to producing this excellent opportunity to support SPL’s continued and future growth.”

American Capital has invested approximately $4.7 billion in the last twelve months, $3 billion year to date and $549 million quarter to date.  These amounts do not include American Capital's unfunded equity commitment and debt funded to its portfolio company European Capital.  For more information about American Capital's portfolio, click here.   

"SPL is the leading independent producer of heparin and pancreatin APIs and is the only independent producer of heparin with both North American and Chinese API purification capabilities, enabling the Company to provide a multi-continent supply chain to its customers,” said American Capital Principal Bowen Diehl.  "In addition to SPL’s long-term customer relationships, the Company holds itself to the highest standards of quality, which has been demonstrated through its history with the FDA and is paramount to its continued success.”
 
“SPL’s expertise in utilizing current Good Manufacturing Practices to produce these complex biologic APIs to the strict standards imposed by the FDA and other regulatory bodies around the globe, has positioned the Company as a valuable partner to its customers in ensuring a regulatory-compliant supply chain” said American Capital Vice President Kyle Bradford.  “In addition, the Company’s Development Services Group leverages the Company’s expertise in designing manufacturing processes for the extraction and purification of new complex molecules from natural sources, on a clinical trial scale, as well as a commercial scale, while providing valuable input to the regulatory filing and approval process for new pharmaceutical compounds.”

SPL’s heparin APIs are critical inputs in the manufacture of heparin-based anticoagulants, which are utilized to treat and prevent thrombosis.  The Company’s pancreatin APIs are used to manufacture pancreatin drugs for the treatment of pancreatic exocrine insufficiency associated with cystic fibrosis and chronic pancreatitis.  In addition, the Company’s Development Services Group is working with several pharmaceutical and biotech companies on developing the API manufacturing processes for new APIs in support of exciting new drug compounds currently in clinical trials.  The Company is based in Waunakee, Wisconsin and has production facilities located in Waunakee and Changzhou, China.
 
"We are very pleased to have American Capital as a partner in continuing to support our customers and grow our business," said Scientific Protein Laboratories CEO David Strunce.  "American Capital has a deep appreciation for the importance of our customer relationships and the critical role of consistent product quality and regulatory compliance in this industry.  We look forward to working with American Capital as we continue to serve as a valuable component of our customers’ global supply chain, as well as a strategic partner to our customers in the development of the drugs of the future."

ABOUT AMERICAN CAPITAL

American Capital is a publicly traded buyout and mezzanine fund with capital resources of $8.9 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 invests up to $350 million per company.

As of July 31, 2006, American Capital shareholders have enjoyed a total return of 420% since the Company's IPO - an annualized return of 20%, assuming reinvestment of dividends. American Capital has paid a total of $1.2 billion in dividends and paid or declared $21.56 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 www.AmericanCapital.com.

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.