FOR IMMEDIATE RELEASE:
August 17, 2005

Contact
David Ehrenfest Steinglass, Managing Director (301) 951-6122
Eugene Krichevsky, Vice President (301) 951-6122
Brian Maney, Director, Corporate Communications (301) 951-6122

AMERICAN CAPITAL INVESTS $45 MILLION IN LEADING CONTENT OUTSOURCING FIRM

Bethesda, MD - August 17, 2005 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today it has invested $45 million in the recapitalization of TechBooks Inc., a leading electronic content outsourcing firm. American Capital's investment takes the form of senior and junior subordinated debt and convertible preferred equity. Bank of America is providing a revolving credit facility. TechBooks management is maintaining a controlling equity interest. Post close, American Capital owns approximately 20% of TechBooks, on a fully diluted basis.

"American Capital is backing a solid management team led by two experienced executives, Chairman and Co-Founder Rakesh Gupta and President and CEO Ranjit Singh, who together have established and built a strong niche player in a growing industry," said American Capital Chief Operating Officer Ira Wagner. "With its primarily India based operations, TechBooks is well positioned to capitalize on the fastest growing market segments in the outsourced content management industry."

American Capital has invested $2.7 billion in the last twelve months, over $1.7 billion year to date and $425 million quarter to date. For more information about American Capital's portfolio click here.

"TechBooks is the leading brand in content outsourcing, well known for its quality, speed and technology advantages," said American Capital Managing Director David Ehrenfest Steinglass. "The Company's India based operations centers, which employ over 2,500, maintain multi-faceted capabilities, including the ability to manage large and complex projects. These operations are complemented by a U.S. based business development production and marketing organization, giving TechBooks a unique competitive advantage with its primarily U.S. based customers."

"The cornerstone of the Company's success is its management depth and strong customer relationships," said American Capital Vice President Eugene Krichevsky. "We expect TechBooks to continue to develop and implement pace setting productivity enhancement tools and to maintain or gain market share with almost all of its customers."

Founded in 1988, TechBooks is headquartered in Fairfax, VA and employs over 3,000. The Company maintains offices in Los Angeles, CA; Boston, MA; York, PA; the United Kingdom; Delhi, India; and Pune, India. TechBooks specializes in composition, data conversion and e-learning services across five main market verticals: educational publishing, providing services to publishers of elementary, high school and college textbooks as well as digital content services for Web, wireless and e-book versions of their textbooks; professional publishing, providing composition and data conversion services to publishers of scientific, technical and medical journals; information publishing, providing data conversion services to libraries, universities and information aggregators; financial publishing, providing data conversion, composition and graphics services to financial printers; and enterprise content services, providing e-learning services, composition, conversion and content management services to major corporations in financial services, pharmaceutical, consulting and computer industries.

"American Capital's perseverance, flexibility and ability to understand our distinctive investment needs made them the ideal investment partner," said Bart Snell, Chief Financial Officer of TechBooks.

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 July 31, 2005, American Capital shareholders have enjoyed a total return of 409% since the Company's IPO - an annualized return of 23%, assuming reinvestment of dividends. American Capital has paid a total of $787 million in dividends and paid or declared $18.29 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.

This announcement is neither an offer to sell nor a solicitation to buy securities.
This announcement appears as a matter of record only.