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FOR IMMEDIATE RELEASE: April 28, 2005 Contact: Ira Wagner, COO, American Capital; President, European Capital (301) 951-6122 Jean Eichenlaub, Managing Director, European Capital +33 (0)1 40 68 06 66 Brian Maney, Director, Corporate Communications (301) 951-6122

American Capital Opens Affiliate European Capital Office in Paris

Bethesda, MD - April 28, 2005 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today the opening of the Paris office of its affiliate European Capital Financial Services Ltd. Leading European Capital in Paris are Jean Eichenlaub, Managing Director and member of the Investment Committee and Jacques Pancrazi, Director. The office will open with six employees.

European Capital is a buyout and mezzanine investment company. European Capital will be an investor in and sponsor of management and employee buyouts, invest in private equity buyouts, and provide capital directly to private and mid-sized public companies. European Capital intends to invest from €5 million to €125 per transaction million in equity, mezzanine debt and senior debt to fund growth, acquisitions and recapitalizations.

"We are proud to announce the opening of our first European Capital office in Paris and the appointment of Jean Eichenlaub as Managing Director and Jacques Pancrazi as Director of European Capital," said Malon Wilkus, American Capital Chairman, President and CEO and Chairman and CEO of European Capital. "This is an outstanding, established team, with tremendous buyout experience in Europe. Jean's team will be instrumental in developing European Capital's presence in Europe. American Capital has spent the past 18 months measuring market opportunities, evaluating industry practices and considering the advantages of our business model in the European market. Having invested in three buyouts in Europe over the past three years without a European presence, we concluded, as part of our strategic planning process, that it was time we establish European Capital as a permanent presence on the Continent."

"European Capital will be introducing to Europe American Capital's unique strengths and financial capabilities made possible by its public company format," said Jean Eichenlaub, Managing Director of European Capital and member of its Investment Committee. "The European buyout and mezzanine middle market totaled over €12 billion in 2004, the second largest in the world. European Capital intends to finance one-stop buyouts of high performing middle market companies, funding with equity, mezzanine and senior debt, and provide financing to equity sponsors in non-control investments. With our large institutional capabilities, we can respond throughout Europe with fast and attractive financing solutions ranging from €5 million to €125 million for middle market companies with enterprise values from €20 million to €250 million."

"We believe that our Paris office will be a cornerstone of our European presence and critical to our success," said Ira Wagner, American Capital Chief Operating Officer and President of European Capital. "Jean Eichenlaub and Jacques Pancrazi, with 15 years of combined experience, bring to European Capital a wealth of European middle market experience. In addition, American Capital Managing Director Roland Cline, a member of our Investment Committee, will be residing in the Paris office to provide integration with American Capital and future offices we establish in Europe. Roland has been with American Capital for 17 years and will provide important institutional continuity to European Capital."

Jean Eichenlaub has been at Banque Lazard's private equity subsidiary, Fonds Partenaires-Gestion, for five years, including serving three years as Deputy Managing Director. Mr. Eichenlaub has led middle market private equity transactions in health care, light industry and manufacturing, specialized distribution and hospitality involving in the aggregate more than €500 million in the French market. Before that he was a Director and head of the asset and structured finance department at Commerzbank in Paris. He has served on the Board of Directors of 11 middle market companies throughout Europe.

Jacques Pancrazi also joins European Capital from Banque Lazard's private equity subsidiary, Fonds Partenaires-Gestion. At Lazard, Mr. Pancrazi was responsible for portfolio management and financial performance monitoring, in addition to several restructuring assignments. Prior to Lazard, he was Corporate Controller, Western Europe, for Primagaz Group and Financial Controller, BTR plc (now Invensys), Sealing Systems France division. Mr. Pancrazi began his career as an auditor at Price Waterhouse, Paris. He has served on the Board of Directors of 7 middle market companies throughout Europe.

ABOUT AMERICAN CAPITAL
American Capital is a publicly traded buyout and mezzanine investment company with capital resources of approximately $5.2 billion and $1 billion of availability. American Capital has invested in over 160 portfolio companies. 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 equity, mezzanine debt and senior debt to fund growth, acquisitions and recapitalizations.

As of March 31, 2005, American Capital shareholders have enjoyed a total return of 311% since the Company's IPO - an annualized return of 21%, assuming reinvestment of dividends. American Capital has paid a total of $717 million in dividends and paid $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.