American Capital Achieves a Gain of $93 Million and Receives $138 Million in Proceeds From Value Plastics Exit

BETHESDA, Md., Sept. 2, 2011 /PRNewswire/ -- American Capital Ltd. (Nasdaq: ACAS) announced today that on August 26, 2011 its portfolio company VP Acquisition Holdings, Inc. ("Value Plastics") was acquired by Nordson Corporation (Nasdaq: NDSN) for $250 million.  American Capital received $138 million in proceeds and realized a gain of $93 million during the third quarter from the transaction, subject to post-closing adjustments.  Value Plastics was advised by Lazard Middle Market LLC on the transaction.  

Including investments in Value Plastics by American Capital's affiliated funds under management, the total proceeds received during the third quarter from the transaction were $222 million, realizing a gain of $157 million, subject to post-closing adjustments.  Including dividends received over the life of their investments, American Capital and its affiliated funds under management received total equity proceeds of $208 million, which exceeded their aggregate original equity investment by $165 million.

Founded in 1968 and based in Fort Collins, CO, Value Plastics designs and manufactures a proprietary line of plastic, disposable fluid connectors used to link flexible tubing in medical devices, analytical equipment and healthcare products of all types.  These products transport blood, air, irrigation solutions and medications, among other fluids.  Value Plastics manufactures over 2,800 SKUs in over 400 separate shapes and configurations of disposable fluid connectors, including barbed plastic luer fittings, tube-to-tube fittings, blood pressure components and threaded fittings.  Value Plastics' products are used in a wide variety of medical device, biopharmaceutical and instrumentation applications.  The products are also used in certain, high value industrial applications where high precision and consistent quality are demanded.  Value Plastics has a unique and diverse global customer base, which includes many of the top tier medical industry players as well as large and small medical device manufacturers.

American Capital originally invested $89 million in the October 2005 recapitalization of Value Plastics.  American Capital's investment took the form of senior term loans, senior and junior subordinated debt and common equity.  American Capital also provided a $5 million revolving credit facility.  For more information about American Capital's investment in Value Plastics, please go to http://www.americancapital.com/our_portfolio/companies/value_plastics.html.

American Capital's compounded annual rate of return earned over the life of its total investment was 29%, including interest, dividends and fees earned over the life of its investment.  The proceeds received by American Capital were greater than the second quarter 2011 valuation of American Capital's  investment by $33 million, or 31%.

"The success of the Value Plastics investment is a result of its strong management team, leading market position, and exceptional financial performance.  We are extremely proud of the company's improvements and success over our investment period, which made it an attractive purchase for Nordson," said Darin Winn, Senior Managing Director.  "We are very pleased with the outcome of this transaction, and continue to actively seek new One-Stop Buyout® opportunities of up to $300 million as well as lending opportunities from $10 million to $100 million."

"Value Plastics is a proven innovator in the fluid connection components industry with a long history of successful product development," said Kyle Bradford, Principal.  "We believe that moving forward, Nordson's operational and financial support will enable Value Plastics to continue its history of innovation and grow its leading position in the industry."

Since American Capital's August 1997 IPO through the second quarter of 2011, the company has earned a 11% compounded annual return, including interest, dividends, fees and net gains, on 325 realizations of senior debt, subordinated debt, equity and structured products investments, totaling $16 billion of committed capital.  These realizations represent 66% of all amounts invested by American Capital since its August 1997 IPO.  Proceeds from these realizations exceeded the total associated prior quarter valuation of the investments by less than 1%.  American Capital earned a 28% compounded annual return on the exit of its equity investments, including dividends, fees and net gains.

For a chart showing American Capital's exited portfolio companies, please go to http://www.americancapital.com/our_portfolio/exited.html.

ABOUT AMERICAN CAPITAL

American Capital is a publicly traded private equity firm and global asset manager.  American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products.  Founded in 1986, American Capital has $52 billion in assets under management and eight offices in the U.S., Europe and Asia.  American Capital and European Capital will consider investment opportunities from $10 million to $300 million.  For further information, please refer to 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 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.

Contact:
Darin Winn, Senior Managing Director, (214) 273-6650
Jeff MacDowell, Managing Director, (214) 273-6633
Kyle Bradford, Principal, (214) 273-6637
Marshall White, Vice President, (214) 273-6657

SOURCE American Capital, Ltd.