FOR IMMEDIATE RELEASE:
February 7, 2007

Contact
Myung Yi, Managing Director, Special Situations (301) 951-6122
Brian Maney, Director, Corporate Communications (301) 951-6122

AMERICAN CAPITAL INVESTS $77 MILLION IN FIVE ADD-ON ACQUISITIONS FOR PORTFOLIO COMPANY EVANS ANALYTICAL GROUP

Bethesda, MD – February 7, 2007 – American Capital Strategies Ltd. (Nasdaq:ACAS) announced today that in the fourth quarter of 2006 it invested an additional $77 million in its portfolio company Evans Analytical Group LLC (“EAG”), the world’s largest independent provider of microanalytical surface analysis and materials characterization services.  American Capital’s investment supported EAG’s add-on acquisitions of five companies: Advanced Materials Engineering Research Inc. (“AMER”), a provider of transmission electron microscopy (“TEM”) testing and circuit repair services in both California and Shanghai, China; Materials Analytical Services Inc. (“MAS”), a leading provider of TEM and other surface analysis testing services lab with three locations in the U.S.; Cascade Scientific and Cascade GmbH (collectively “Cascade”), one of the largest independent surface analysis and materials characterization labs in Europe, the U.K. and Germany; the Shiva Technologies Group (“Shiva”), comprised of Shiva US and Shiva France, the largest provider of glow discharge mass spectrometry (“GDMS”) services worldwide; and Nano Sciences (“Nano”), the exclusive sales representative for EAG and Shiva in Japan.  American Capital’s investments took the form of additional senior term loans and additional senior subordinated debt.  American Capital also increased EAG’s revolving credit facility.

“We are very pleased to be making additional investments in Evans Analytical Group,” said American Capital Managing Director Gordon O’Brien.  “These investments support the acquisition of five excellent companies.  American Capital’s participation in these add-ons demonstrates the continuing support of our Special Situations Group for our portfolio company EAG and its management team. Since our initial investment in EAG in September 2005, management has successfully and seamlessly integrated several acquisitions and exceeded growth targets.”

American Capital invested directly and through its funds under management $6.7 billion in 2006 and $2.2 billion in the fourth quarter of 2006 and has invested $752 million in 2007 year to date.  Not including funds under management, American Capital invested $5.1 billion in 2006 and $1.7 billion in the fourth quarter of 2006 and has invested $660 million in 2007 year to date.  Since its inception in early 2005, the Special Situations Group has invested $290 million in 6 portfolio companies, including nearly $100 million in the fourth quarter of 2006.  For more information about American Capital’s portfolio, click here .

“EAG’s acquisitions of AMER, MAS, Cascade, the Shiva Group and Nano further extends the Company’s market leading range of testing capabilities to include substantially all of the major surface analysis techniques,” said Myung Yi, American Capital Managing Director, Special Situations.  “The addition of both high- and mid-range TEM capabilities from AMER and MAS establishes EAG as a principal provider of TEM services while the Shiva acquisition makes EAG the leader in GDMS.  By acquiring Cascade and Shiva France, EAG has extended its lab presence into Europe and created an important base for future growth in that market. Likewise, making Nano Science a part of EAG after many years of a very successful sales relationship will help the Company aggressively expand in Japan.  With all of these acquisitions, EAG becomes the one-stop shop for the testing needs of a significantly broadened customer base producing numerous new cross-selling opportunities.”

“These acquisitions increase EAG’s capabilities and global reach,” said Mark Fikse, American Capital Principal, Operations Team.  “EAG’s management team has proven their ability to integrate businesses and take advantage of synergies.”

Evans Analytical Group was formed in June 2005 from the combination of assets of the Evans Analytical laboratories of High Voltage Engineering Corporation and three affiliates - Evans East, Evans Texas and Cascade Scientific Labs Inc.  EAG is the largest independent provider of microanalytical surface testing services in the world.  The Company provides a comprehensive suite of microanalytical imaging, surface analysis and materials characterization services as well as semiconductor circuit repair and failure analysis testing.  EAG's services are a critical enabling component in research & development and manufacturing and sales support functions. They are used specifically in developing new processes or materials, transferring those processes to production, developing and qualifying new production tools and solving manufacturing yield problems.  EAG has more than 2,000 customers in the semiconductor, semiconductor equipment, electronics, biomedical, biotech and other industries. Headquartered in Sunnyvale, California, EAG also has facilities in Arizona, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Texas, China, Taiwan, England, France, Germany, Japan and the United Kingdom, as well as sales and support offices in Korea and Singapore.

For more information about American Capital's original investment, click here.

ABOUT AMERICAN CAPITAL

American Capital is the largest U.S. publicly traded alternative asset manager with $12 billion in capital resources under management.  American Capital, both directly and through its global asset management business, is an investor in management and employee buyouts, private equity buyouts, and early stage and mature private and public companies.  American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalizations and securitizations.  American Capital invests from $5 million to $500 million in North America and €5 million to €400 million in Europe.

As of January 31, 2007, American Capital shareholders have enjoyed a total return of 655% since the Company's IPO - an annualized return of 24%, assuming reinvestment of dividends.  American Capital has paid a total of $1.4 billion in dividends and paid $22.44 in dividends per share since its going public in August 1997 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 or www.EuropeanCapital.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 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.