American Capital Receives $12 Million in Proceeds from Narus Exit

BETHESDA, Md., Aug. 23 /PRNewswire-FirstCall/ -- American Capital Ltd. (Nasdaq: ACAS) announced today that on July 29 its portfolio company Narus was acquired by Boeing.  American Capital received $12 million in proceeds and realized a gain of $3 million during the third quarter from the transaction, subject to post-closing adjustments.  American Capital's compounded annual rate of return earned over the life of its investment was 7%.  The proceeds received by American Capital were less than the second quarter 2010 valuation of the investment by $2 million, or 13%.  Including investments in Narus by American Capital's affiliated funds under management, the total proceeds received during the third quarter from the transaction were $21 million, realizing a gain of $5 million, subject to post-closing adjustments.

Narus is a leading provider of real-time network traffic and analytics software used to protect against cyber attacks and persistent threats aimed at large Internet Protocol networks.  Headquartered in Sunnyvale, California, the company employs approximately 150 people.  American Capital and its affiliates made an initial direct investment of $13 million in Narus in October 2006 and provided subsequent financing for growth and working capital.  American Capital's initial investment took the form of convertible preferred equity.  For more information about American Capital's investment in Narus, please go to http://www.americancapital.com/our_portfolio/companies/narus.html.

Since American Capital's August 1997 IPO through the second quarter of 2010, the company has earned a 12% compounded annual return, including interest, dividends, fees and net gains, on 299 realizations of senior debt, subordinated debt and equity investments, totaling $14 billion of committed capital.  These realizations represent 58% 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 26% 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 $15 billion in capital resources under management and eight offices in the U.S., Europe and Asia.  American Capital and its affiliates will consider investment opportunities from $5 million to $100 million.  For further information, please refer to www.AmericanCapital.com.

ABOUT BOEING DEFENSE, SPACE & SECURITY

A unit of The Boeing Company, Boeing Defense, Space & Security is one of the world's largest defense, space and security businesses specializing in innovative and capabilities-driven customer solutions, and the world's largest and most versatile manufacturer of military aircraft.  Headquartered in St. Louis, Boeing Defense, Space & Security is a $34 billion business with 68,000 employees worldwide.

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.

SOURCE American Capital Ltd.