American Capital Receives $244 Million from Sale of Portfolio Company Service Experts and Generates a 184% Return on Its Investment

BETHESDA, Md., May 11, 2016 /PRNewswire/ -- American Capital, Ltd. (Nasdaq: ACAS) ("American Capital") announced today that its portfolio company SEHAC Holdings Corporation (together with its subsidiaries, "Service Experts" or the "Company") has merged with a subsidiary of Enercare Solutions Inc., a wholly-owned subsidiary of Enercare Inc. (TSX: ECI), one of Canada's largest home and commercial services companies.  The total cash consideration is $340.75 million, subject to customary working capital and other post-closing adjustments.  American Capital received $244 million in proceeds, including fees and assuming full collection of escrow and other holdback amounts, and realized a capital gain of $225 million from the transaction.  Over the life of the investment, American Capital realized 18 times its investment in the Company and generated a compounded annual rate of return of 184%, including interest, dividends, fees and realized gains.

American Capital acquired Service Experts in a One Stop Buyout® in March 2013 (for more information, click here).  Headquartered in Plano, TX, Service Experts is a leading provider of sales, installation, maintenance and repair of HVAC systems for the residential and commercial markets, operating 90 branch locations across the United States and Canada with approximately 2,800 employees and $435 million in annual sales. 

"Since our investment three years ago, Service Experts has thrived under the leadership of Scott Boxer, President & CEO.  The Company achieved significant growth as a result of its focus on customer service and the completion of multiple strategic acquisitions, which collectively expanded its geographical presence and service offering, and boosted revenues.  We are proud to have been a part of Service Experts' success," said Myung Yi, Managing Director, American Capital Special Situations.  

Anuj Khanna, Principal, American Capital Special Situations, said, "The tremendous success of our investment in Service Experts is a result of the tireless effort and commitment of the Company's executive leadership team and the approximately 2,800 employees across the United States and Canada, in conjunction with the financial, operational and strategic capabilities of American Capital Special Situations.  Together, we have made significant and permanent improvements to the business, while returning the Company to prominence within the HVAC industry.  We believe Enercare is well positioned to enhance the Company's future prospects, and we wish them all the best in this endeavor."

"As our partnership with American Capital Special Situations comes to a close, I would like to thank the team for its unwavering support of Service Experts over the past three years.  The team's strategic guidance and hands-on approach to managing the investment have been a tremendous asset to the organization.  Moreover, I would like to recognize our key supply partners, including Lennox International, Inc., for their outstanding service and support of Service Experts.  We look forward to beginning our partnership with Enercare and building one of the leading home and commercial services companies in North America," said, Scott Boxer, President & CEO of Service Experts.

Moelis & Company LLC acted as financial advisor to Service Experts in connection with the transaction, while Arnold & Porter LLP served as M&A counsel and Osler, Hoskin & Harcourt LLP served as Canadian counsel.

ABOUT AMERICAN CAPITAL SPECIAL SITUATIONS
American Capital Special Situations is an experienced team of professionals exclusively focused on providing capital to complex or unique situations.  The team's flexible capital mandate provides it the ability to invest throughout the capital structure in both debt financings and equity buyouts.  American Capital Special Situations has been a partner to middle market companies with attractive franchise value that have experienced periods of excess leverage, operational and/or financial underperformance, or other special circumstances that necessitated a flexible capital solution to reposition the business for growth.  Since its inception in 2005 and as of March 31, 2016, American Capital Special Situations has invested $1.2 billion in 14 companies and earned a 22% compounded annual rate of return, including interest, dividends, fees and net gains.[1]

ABOUT AMERICAN CAPITAL
American Capital, Ltd. (Nasdaq: ACAS) 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.  American Capital manages $20 billion of assets, including assets on its balance sheet and fee earning assets under management by affiliated managers, with $77 billion of total assets under management (including levered assets).  Through a wholly owned affiliate, American Capital manages publicly traded American Capital Agency Corp. (Nasdaq: AGNC), American Capital Mortgage Investment Corp. (Nasdaq: MTGE) and American Capital Senior Floating, Ltd. (Nasdaq: ACSF) with approximately $10 billion of total net book value.  American Capital and its affiliates operate out of six offices in the U.S. and Europe.  For further information, please refer to www.AmericanCapital.com.

[1] Compounded annual rate of return includes 9 realized investments and 5 unrealized investments at fair market value as of March 31, 2016.

Contact: (301) 951-6122

American Capital Special Situations
Myung Yi, Managing Director
Anuj Khanna, Principal 
Yaniv Zief, Principal 
Michael Raynor, Vice President

SOURCE American Capital, Ltd.