American Capital

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American Capital, Ltd. (the Company) was a publicly traded private equity and global asset management firm, trading on NASDAQ under the symbol "ACAS" from 1997 to 2017. American Capital, both directly and through its asset management business, originated, underwrote and managed investments in middle market private equity, leveraged finance and structured products. It participated in management and employee buyouts either by providing mezzanine and senior debt financing for buyouts led by private equity firms or by providing capital directly to companies through a "One Stop Buyout" in which it funded senior debt, mezzanine and equity and was the controlling shareholder. American Capital and its affiliates invested from $10 million to $600 million per company in North America and EUR10 million to EUR300 million per company in Europe. At its peak, American Capital had over $100 billion of assets under management.

Founded in 1986, American Capital went public in August 1997 at $15.00 per share, raising $155 million, making it the first private equity firm to go public in the United States. American Capital was sold on January 3rd, 2017 to Ares Management for $4.1 billion or $18.06 per share. Adjusted for a stock dividend paid in 2009, which had the effect of a stock split, the $18.06 per share selling price translates to approximately $23.50 a share when compared to its share price at the time of its IPO. In addition, during its time as a public company, American Capital paid $30.32 per share in dividends.

For those investors who bought American Capital stock in its 1997 IPO, and held their shares through the sale of American Capital, they received a 14% compounded annual return including dividends (not reinvested). This compares favorably to the 10% return made by investors in shares of Berkshire Hathaway over the same period. It wasn't just investors in its IPO who outperformed the market. For a stockholder who invested in one share of ACAS at its IPO and one share of ACAS on January first of each of the 19 years it was public and held the shares through to the sale on January 3rd, 2017, 70% of those 20 investments would have outperformed the S&P 500 Financial Sector over the same time periods.

These results were achieved through two recessions, including the Great Recession. From the time of its IPO through 2015, American Capital produced a 16% Economic Return, that is, a 16% growth in its book value plus dividends paid. And, despite the Great Recession, the $5 billion American Capital invested in the equity of its One Stop Buyouts produced a 16% compounded annual return.

American Capital built seven billion-dollar financial institutions over the years which included: American Capital, American Capital Equity I, European Capital, American Capital Agency, American Capital Mortgage, American Capital Equity III and American Capital Asset Management. American Capital took five companies public, and invested over $33 billion in middle market companies to support their buyouts and growth. During the time American Capital was public, it owned and or controlled over 155 companies and invested in over 600 companies, including well-known companies such as AAMCO, Aeriform Corporation, Affordable Care, Algoma Group, Bumble Bee Seafoods, Bushnell Outdoor Products, CamelBak Products, Case Logic, Confluence Kayaks, Crosman Corporation, Cycle Gear, Electrolux, Explorer Pipeline, Euro-Pro, Evenflo Company, Gibson Guitars, Meadows of Wickenburg, Nancy's Specialty Foods, New England Confectionary Company (NECCO), Parts Plus, Piper Aircraft, Potpourri, Riddell Sports Group, Ranpak, Rug Doctor and Service Experts.

American Capital was founded by Malon Wilkus in 1986, who resigned as Chairperson and Chief Executive Officer (CEO) at the time of the sale of American Capital in 2017. American Capital was headquartered in Bethesda, Maryland. Malon Wilkus was Chairperson and President of American Capital from its founding until its IPO in 1997. It made its first investment in the equity of an employee owned middle market company in 1990. By August 1997, American Capital had facilitated approximately 18 ESOP transactions (Employee Stock Ownership Plans) and had invested in the equity of 7 employee buyouts. Based on third party valuations and net realized gains, the return on these investments was 36% per annum prior to its IPO. With that track record American Capital went public on August 29, 1997 in a $155 million equity offering at a price of $15.00 per share. At the time of its IPO, American Capital changed its operations and tax status to a Business Development Company (BDC). American Capital immediately began paying dividends and continued paying regular dividends until 2009. At the time of its IPO, American Capital maintained its headquarters in Bethesda, MD, with additional professionals based in or near New York, Pittsburgh, San Francisco, Savannah and Boston. As of the IPO date, David Gladstone, former Chairperson and CEO of Allied Capital (a then existing BDC), was elected Chairperson, Malon Wilkus was elected Vice Chairperson and was appointed President and CEO, Adam Blumenthal was appointed Director and Executive Vice President, Steve Hester was appointed Vice President and General Counsel and Roland Cline was appointed Vice President.

Results for 1997: Revenue in 1997 was $2.8 million, Net Operating Income (NOI) was $2.3 million, $0.20 per diluted share and earnings totaled $2.4 million, $0.21 per diluted share. Its stock price closed the year at $18.13 per share, with book value of $151 million, $13.61 per share, and total assets under management of $151 million. By year end, American Capital had paid $0.21 per share of dividends since its IPO.

In 1998, American Capital expanded and opened additional offices in Chicago and Dallas and successfully raised another $30 million of debt capital. Malon Wilkus was elected Chairperson and continued as President and CEO, David Gladstone was elected Vice Chairperson and John Erickson was appointed Vice President and Chief Financial Officer (CFO).

Results for 1998: Revenue in 1998 was $17.0 million, NOI was $14.8 million, $1.29 per diluted share and earnings totaled $16.9 million, $1.48 per diluted share. Its stock price closed the year at $17.25 per share, with book value of $153 million, $13.80 per share, and total assets under management of $270 million. By year end, American Capital had paid $1.55 per share of dividends since its IPO.

ACAS showed strong growth in 1999, raising $190 million in debt and equity capital. . Malon Wilkus resigned as President, but continued to be Chairperson and CEO and Adam Blumenthal was appointed President and Chief Operating Officer (COO).

Results for 1999: Revenue in 1999 was $33.4 million, NOI was $24.7 million, $1.73 per diluted share and earnings totaled $97.2 million, $6.80 per diluted share. Its stock price closed the year at $22.75 per share, with book value of $311 million, $17.08 per share, and total assets under management of $395 million. By year end, American Capital had paid $3.29 per share of dividends since its IPO.

By 2000, additional offices in Los Angeles and Philadelphia were opened as the company continued its growth. ACAS formed an internal Operations Team headed by Gordon O'Brien, at the time a unique department for a private equity and mezzanine firm, composed of former C-level executives and vice presidents who would work onsite at its portfolio companies to maximize returns. American Capital raised $412 million of debt and equity in four offerings.

Results for 2000: Revenue in 2000 was $70.1 million, NOI was $44.7 million, $1.96 per diluted share and earnings totaled a loss of $4.4 million, ($0.20) per diluted share. Its stock price closed the year at $25.19 per share, with book value of $445 million, $15.90 per share, and total assets under management of $614 million. By year end, American Capital had paid $5.46 per share of dividends since its IPO.

In 2001, American Capital raised $237 million of debt and equity in three offerings. David Gladstone resigned his positions at the Company and the Board of Directors and departed the company, Malon Wilkus continued as Chairperson and CEO and was again appointed President, Adam Blumenthal was elected Vice Chairperson and resigned his other positions and departed from the Company, Ira Wagner was appointed Senior Vice President and later in the year appointed Executive Vice President and COO, Roland Cline and John Freal were appointed Senior Vice Presidents and Managing Directors, and Gordon O'Brien was appointed Senior Vice President and Managing Director of Operations. American Capital formed an internal financial analysis and compliance team headed by Jay Beam, to perform financial due diligence for buyout investments and to provide financial and information technology (IT) advisory services to portfolio companies and to conduct internal valuations, a novel internal department for a private equity and mezzanine firm, which had approximately 90 finance, IT and accounting personnel at its peak.

Results for 2001: Revenue in 2001 was $104.2 million, NOI was $71.6 million, $2.24 per diluted share, and earnings totaled $18.6 million, $0.58 per diluted share. Its stock price closed the year at $28.35 per share, with book value of $640 million, $16.84 per share, and total assets under management of $910 million. By year end, American Capital had paid $7.76 per share of dividends since its IPO.

In 2002, American Capital opened its Los Angeles office. It raised $436 million of debt and equity in four offerings. Darin Winn was appointed Senior Vice President and Managing Director. Tom McHale was appointed Vice President of Finance and Investor Relations. John Freal resigned his positions in the Company and departed from the firm.

Results for 2002: Revenue in 2002 was $147 million, NOI was $102 million, $2.57 per diluted share and earnings totaled $20.1 million, $0.50 per diluted share. Its stock price closed the year at $21.59 per share, with book value of $688 million, $15.82 per share, and total assets under management of $1.4 billion. By year end, American Capital had paid $10.33 per share of dividends since its IPO.

In 2003, American Capital raised a record breaking $1.1 billion of debt and equity in six offerings.

Results for 2003: Revenue in 2003 was $206 million, NOI was $141 million, $2.56 per diluted share and earnings totaled $118.0 million, $2.15 per diluted share. Its stock price closed the year at $29.73 per share, with book value of $1.2 billion, $17.83 per share, and total assets under management of $2.1 billion. By year end, American Capital had paid $13.12 per share of dividends since its IPO.

The year 2004 brought even more record setting achievements for American Capital. A total of $2.2 billion of debt and equity capital was raised through nine offerings, and in the first half of the year and ACAS became the largest BDC. American Capital was the first BDC to raise equity through a Forward Sale Agreement. Frank Do was appointed Senior Vice President and Managing Director of its Los Angeles office.

Results for 2004: Revenue in 2004 was $336 million, NOI was $220 million, $2.83 per diluted share and earnings totaled $281 million, $3.63 per diluted share. Its stock price closed the year at $33.35 per share, with book value of $1.9 billion, $21.11 per share, and total assets under management of $3.5 billion. By year end, seven years after its IPO, American Capital had paid out $16.03 per share of dividends, more than its $15.00 per share IPO stock price.

In 2005, American Capital raised EUR750 million of equity for European Capital Ltd. (ECAS), its first externally managed private equity and mezzanine fund. The mission of European Capital was to provide in Europe mezzanine and senior debt financing for buyouts led by private equity firms or to provide capital directly to companies through a "One Stop Buyout" in which it funded senior debt, mezzanine and equity and was the controlling shareholder. Paris and London were the first of several offices. Malon Wilkus was elected Chairperson and appointed President and CEO of European Capital, Ira Wagner was appointed its COO, and John Erickson was appointed its CFO. Roland Cline was appointed its Executive Vice President, and Nathalie Faure Beaulieu and Jean Eichenlaub were appointed Managing Directors.

In addition, in 2005, American Capital expanded its investment strategy by establishing specialized investment teams focusing on (1) Special Situations, led by Gordon O'Brien and Managing Director Myung Yi, (2) Syndications, led by Jeff Schumacher, Senior Vice President, Group Head of Syndications, (3) Energy, led by Darin Winn and Kevin Kuykendall, Managing Director, as well as (4) Commercial Mortgage Asset Management Group, led by Doug Cooper, Managing Director, and (5) Leverage Finance led by Mark Pelletier, President, CIO and Senior Portfolio Manager. Samuel Flax was appointed Executive Vice President and General Counsel. American Capital raised $2.5 billion of debt and equity in nine offerings.

Results for 2005: Revenue in 2005 was $554 million, NOI was $313 million, $3.10 per diluted share and earnings totaled $364 million, $3.60 per diluted share. Its stock price closed the year at $36.21 per share, with book value of $2.9 billion, $24.37 per share, and total assets under management of $5.7 billion. By year end, American Capital had paid $19.11 per share of dividends since its IPO.

In 2006, American Capital's growth continued with the establishment of a technology investment team headed by Virginia Turezyn and Andy Fillat, who were appointed Managing Directors, with offices in Boston and Palo Alto. Bob Grunewald was appointed Managing Director of the newly formed American Capital Financial Services Group. European Capital expanded considerably by raising $1.3 billion of debt in two offerings. American Capital, in addition, raised its second externally managed private equity fund, American Capital Equity I, through a novel sale of a significant portion of its private equity investments to a third-party fund that it then managed. American Capital issued debt and equity ten times in 2006, raising $2.4 billion for its own balance sheet. It also received investment grade ratings from Moody's, S&P and Fitch.

Results for 2006: Revenue in 2006 was $860 million, NOI was $425 million, $3.11 per diluted share and earnings totaled $896 million, $6.55 per diluted share. Its stock price closed the year at $46.26 per share, with book value of $4.3 billion, $29.42 per share, and total assets under management of $11.3 billion. By year end, American Capital had paid $22.44 per share of dividends since its IPO.

In 2007, a total of $4.3 billion of debt and equity capital was raised for American Capital's balance sheet, through ten offerings, including the first $1.0 billion public equity raise by a BDC. European Capital opened additional offices in Frankfurt and Madrid, and formed specialized teams to invest in distressed debt and second lien loans. European Capital was taken public in May of 2006 and traded on the London Exchange, raising $195 million of equity, and in two other offerings raised $280 million of debt. In addition, American Capital raised its first of nine CLO funds (Collateralized Loan Obligations) and its first CRE CDO fund of senior loans, totaling $811 million which it externally managed. Mark Pelletier was appointed Senior Vice President and Managing Director of the CDO and CLO Group. American Capital raised its third externally managed private equity fund, American Capital Equity II, totaling $585 million and Malon Wilkus was elected its Chairperson and appointed President and CEO and John Erickson was appointed its CFO. Finally, in the Spring of that year, American Capital was included in the S&P 500 index of public companies. Andy Fillat resigned his positions and departed from the Company.

Results for 2007: Revenue in 2007 was $1.2 billion, NOI was $594 million, $3.36 per diluted share and earnings totaled $700 million, $3.96 per diluted share. Its stock price closed the year at $32.96 per share, with book value of $6.4 billion, $32.88 per share, and total assets under management of $17.1 billion. By year end, American Capital had paid $26.16 per share of dividends since its IPO.

The Great Recession began at the turn of 2007, striking a blow to the world's economies, capital markets and asset valuations in that year and in 2008. American Capital was not immune from the economic crisis affecting the U.S. and global financial and business markets. As a BDC, American Capital had to fair value its assets quarterly. Therefore, American Capital had to dramatically depreciate its assets, whether they were performing or not, in line with comparable market valuations. Performance declined, in many cases materially, at some of its portfolio companies and investments.

In 2008, to address the new realities facing the company, American Capital began a series of consolidation and down-sizing actions to address the declining and illiquid markets, focus on maintaining quality in its portfolio and addressing certain troubled investments. Certain business strategies in the U.S. and Europe were exited to adjust to the dramatic change in market conditions. American Capital closed offices in Los Angeles, Palo Alto, Philadelphia and San Francisco, continuing to operate offices in Bethesda, Boston, Dallas, Providence and New York. European Capital closed offices in Frankfurt and Madrid, continuing to operate offices in London and Paris. Despite these adversities, European Capital raised $492 million of debt in a single offering. And, American Capital launched and took public American Capital Agency, NASDAQ: AGNC, an agency real estate investment trust, REIT, which it externally managed and which was to play an important role in the subsequent turnaround of American Capital. Malon Wilkus was elected its Chairperson, and appointed President and CEO of AGNC, John Erickson was appointed its CFO and Russell Jeffrey was appointed its Chief Investment Officer (CIO).

In 2008, Malon Wilkus resigned as President of American Capital, continuing as Chairperson and CEO and maintaining his existing responsibilities. Steven Burge was appointed President of North American Private Finance. Ira Wagner was appointed President of European Private Finance, dropping his responsibilities as COO of North America Private Finance. John Erickson was appointed President, Structured Finance, continuing as Chief Financial Officer. Gordon O'Brien, was appointed President, Specialty Finance and Operations. Frank Do and Virginia Turezyn resigned their positions and departed from the Company.

Results for 2008: Revenue in 2008 was $1.1 billion, NOI was $493 million, $2.42 per diluted share and earnings totaled a net loss of $3.1 billion, ($15.29) per diluted share. Its stock price closed the year at $3.24 per share, with book value of $3.2 billion, $15.41, and total assets under management of $13.4 billion. By year end, American Capital had paid $29.25 per share of dividends since its IPO. However, in the third quarter, American Capital terminated its regular quarterly dividend.

In 2009, American Capital Agency, raised $233 million of equity in two offerings, beginning its rapid growth and industry leading performance. Russell Jeffrey resigned his positions and departed from American Capital and AGNC, and the Providence office was closed. Gary Kain was appointed Senior Vice President and Managing Director of American Capital and Senior Vice President and Chief Investment Officer of AGNC. Bob Grunewald resigned his positions and departed from the Company. European Capital, whose stock price and performance was subject to the same depreciating environment as American Capital and other financial assets during the Great Recession, was taken private by merging into American Capital. Tristan Parisot was appointed Managing Director of the European Capital Paris office. Jean Eichenlaub resigned his positions and departed from European Capital and European Capital closed its Frankfurt office. Due to the dramatic depreciation of its assets, American Capital defaulted on its debt and began negotiations with its creditors. ACAS was removed from the S&P 500 in early 2009.

Results for 2009: Revenue in 2009 was $697 million, NOI was $135 million, $0.56 per diluted share and earnings totaled a net loss of $910 million, ($3.77) per diluted share. Its stock price closed the year at $2.44 per share, with book value of $2.3 billion, $8.29 per share, and total assets under management of $12.5 billion. In late summer, American Capital paid a special stock and cash dividend totaling $1.07 per share, causing approximately 30% dilution in its stock outstanding. By year end, American Capital had paid $30.32 per share of dividends since its IPO.

In 2010, through a direct equity offering primarily with Paulsen & Co. Inc., $295 million of equity was raised in April at $5.06 per share. A refinancing agreement was reached with American Capital creditors in mid-2010. Under the terms of the transaction, lenders and noteholders had the option of receiving either cash or new secured debt, in each case in the full principal amount of their pre-transaction debt. Lenders and noteholders holding $1.03 billion of debt, 44% of pre-transaction debt, selected and received 100% cash for their debt, while lenders and noteholders holding $1.31 billion of debt, 56% of pre-transaction debt, elected to receive new secured loans or notes of various series.

Also, in 2010, American Capital Agency raised $1.1 billion of equity through several offerings in May, June and December, continuing its dramatic growth phase. Malon Wilkus resigned as President of American Capital Agency Management, continuing as Chairperson and CEO, and Gary Kain was appointed President of American Capital Agency Management, continuing as Chief Investment Officer of AGNC. Christopher Kuehl was appointed Head of Mortgage Investments at AGNC.

Results for 2010: Revenue in 2010 was $600 million, NOI was $204 million, $0.62 per diluted share and earnings totaled $998 million, $3.02 per diluted share. Its stock price closed the year at $7.56 per share, with book value of $3.7 billion, $10.71 per share, and total assets under management of $22.6 billion.

In 2011, American Capital Agency raised $4.4 billion of equity through offerings in January, March, June and November. American Capital initiated an IPO of newly formed American Capital Mortgage Investment Corp, NASDAQ: MTGE, a hybrid mortgage REIT, raising $581 million. Malon Wilkus was elected its Chairperson and appointed CEO. Gary Kain was appointed President and Co-Chief Investment Officer, Jeff Winkler was appointed Senior Vice President and Co-Chief Investment Officer and Peter Federico was appointed Senior Vice President and Chief Risk Officer of both MTGE and AGNC. Steven Burge resigned his positions and departed from the Company. American Capital announced a stock repurchase and dividend program under which, quarterly, American Capital would consider setting an amount to be utilized for stock repurchases or dividends. Generally, the amount would be utilized for repurchases if the price of American Capital's common stock represented a discount to the net asset value of its shares, and the amount would be utilized for the payment of cash dividends if the price of American Capital's common stock represented a premium to the net asset value of its shares.

Results for 2011: Revenue in 2011 was $591 million, NOI was $448 million, $1.26 per diluted share and earnings totaled $974 million, $2.74 per diluted share. Its stock price closed the year at $6.73 per share, with book value of $4.6 billion, $13.87 per share, and total assets under management of $68 billion. By year-end, American Capital had repurchased $134 million of its stock since inception of its buyback program.

In 2012, American Capital refinanced its debt in June and raised $250 million of debt in August. American Capital Agency raised $3.7 billion in three equity offerings. American Capital Mortgage raised $581 million in three equity offerings. American Capital raised $362 million of debt for its third externally managed CLO. American Capital formed American Capital Infrastructure to invest in global energy infrastructure assets. Malon Wilkus was elected its Chairperson and Paul Hanrahan, former CEO of AES Corporation, was appointed CEO, John Erickson was appointed its CFO and Richard Santoroski was appointed Managing Director. An Annapolis, MD office was opened.

Results for 2012: Revenue in 2012 was $646 million, NOI was $397 million, $1.20 per diluted share and earnings totaled $1.1 billion, $3.44 per diluted share. Its stock price closed the year at $12.02 per share, with book value of $5.4 billion, $17.84 per share, and total assets under management of $117 billion. By year-end, American Capital repurchased $495 million of its stock since inception of its buyback program.

In 2013, there was a considerable amount of fund development and growth. American Capital formed a Leveraged Finance Investment Team and a Lower Middle Market Investment Team led by Managing Directors Sean Eagle, Eugene Krichevsky, David Steinglass and Justin DuFour. American Capital closed its Boston office. AGNC raised $1.8 billion of equity and MTGE raised $584 million of equity, both continuing their rapid growth. American Capital raised $828 million of debt in total for its fourth and fifth externally managed CLOs. American Capital launched American Capital Senior Floating (ACSF), an externally managed BDC investing predominately in senior secured debt of middle and large market U.S. companies and equity tranches of CLOs, and raised $340 million of debt for ACSF. S&P upgraded its rating of American Capital from BB- to B+ in August. American Capital raised $350 million of debt for its own balance sheet. Kevin Kuykendall resigned his positions and departed from the company.

Results for 2013: Revenue in 2013 was $487 million, NOI was $156 million, $0.51 per diluted share and earnings totaled $184 million, $0.61 per diluted share. Its stock price closed the year at $15.64 per share, with book value of $5.1 billion, $18.97 per share, and total assets under management of $93 billion. By year-end, American Capital repurchased $1.1 billion of its stock since inception of its buyback program.

In January 2014, American Capital Senior Floating raised $150 million of equity through its IPO (NASDAQ: ACSF). Malon Wilkus was elected its Chairperson and appointed CEO, Mark Pelletier was appointed its President and Chief Investment Officer and John Erickson was appointed its CFO. Mark Pelletier also was appointed President of American Capital CLO Management. MTGE raised $53 million of equity. American Capital raised $1.1 billion of equity for its fourth, externally managed private equity fund, American Capital Equity III, managed by the American Capital Lower Middle Market Buyout group. And, European Capital raised 100 million pounds for its first externally managed European private mezzanine fund, ECAS UK SME. American Capital raised $619 million and $411 million of debt for its sixth and seventh externally managed CLOs.

Also in 2014, American Capital approved a plan to split the Company's businesses by transferring most of the Corporation's investment assets to two newly established business development companies (BDCs), American Capital Growth and Income and American Capital Income. American Capital would continue primarily in the asset management business and would manage these two new BDCs. It was contemplated that American Capital would spin off the new BDCs to its shareholders, resulting in three, publicly-traded companies (the "Spin Off"). In 2014, American Capital raised $1.7 billion of debt for its own balance sheet.

Results for 2014: Revenue in 2014 was $471 million, NOI was $117 million, $0.42 per diluted share and earnings totaled $434 million, $1.55 per diluted share. Its stock price closed the year at $14.61 per share, with book value of $5.5 billion, $20.50 per share, and total assets under management of $86 billion. By year-end, American Capital repurchased $1.2 billion of its stock since inception of its buyback program.

In 2015, American Capital amended its Spin Off plan by announcing that it would systematically exit its buyout portfolio and only Spin Off one BDC to its shareholders, American Capital Income. European Capital raised EUR387 million through two offerings, for its second externally managed private European mezzanine fund, ECAS Private Debt Fund. American Capital raised $552 million and $510 million of debt for its eighth and ninth externally managed CLOs. And it raised $450 million of equity for the first of its kind, externally managed private fund of CLO equity. In addition, American Capital raised $500 million of debt for its own balance sheet. Brian Graff was appointed President of American Capital Private Finance and Gordon O'Brien was appointed President of European Capital. John Scheurer joined and was appointed Managing Director and Chief Investment Officer of the American Capital Commercial Real Estate Group. Ira Wagner and Darin Winn resigned their positions and departed from the Company, and American Capital closed its Dallas office. Jeff Winkler resigned his positions from AGNC and its manager and departed from the company.

On November 25, 2015, with the market failing to reflect support for its Spin Off plan, including lack of support from its major shareholders, including a new activist shareholder that had become the Company's largest shareholder, American Capital announced a full strategic review of all alternatives. The strategic review was conducted by an independent committee of the Board of Directors. Goldman Sachs and Credit Suisse were engaged to assist in the review. The strategic review would consider all alternatives for maximizing shareholder value, including a sale of the Company or its various business lines in whole or in part. Malon Wilkus, Founder, Chairperson and Chief Executive Officer of American Capital was quoted in the announcement of the strategic review saying, "We have generated a 16% annualized growth rate in both our book value and price per share over the five years ended September 30, 2015. Nonetheless, we continue to trade at a meaningful discount to our book value, even as we progress with our plans for the Spin Off, which is intended to unlock shareholder value. Therefore, I am fully supportive of this strategic review, which will allow us to realize the optimal value for our shareholders."

Results for 2015: Revenue in 2015 was $671 million, NOI was $253 million, $0.95 per diluted share and earnings totaled to a loss of $187 million, ($0.70) per diluted share. Its stock price closed the year at $13.79 per share, with book value of $4.8 billion, $19.88 per share, and total assets under management of $73 billion. By year-end, American Capital repurchased $1.7 billion of its stock since inception of its buyback program.

On January 7, 2016, American Capital announced its Board of Directors had completed the initial phase of its previously announced strategic review process and had authorized the Company to proceed with the solicitation of offers to purchase the Company or its various business lines in whole or in part. Goldman Sachs and Credit Suisse were engaged as financial advisors to assist American Capital with the sale process. Malon Wilkus, American Capital's Founder, Chairperson and Chief Executive Officer was quoted in the announcement saying, "The management team recommended and fully supports the decision by the Board to proceed with the solicitation of offers and believes that it is in the best interests of our shareholders. Our business lines and assets have tremendous value, which is not reflected in our current share price, and we believe these actions will help realize that value. We are working closely with our advisors to maximize shareholder value."

In April, American Capital raised $406 million of debt for its tenth externally managed CLO, and European Capital raised EUR90 million of equity for its fifth private equity fund.

On May 23, 2016, American Capital announced it had entered into a definitive agreement to sell American Capital to Ares Capital. At the same time, it announced a definitive agreement to sell American Capital Mortgage Management to American Capital Agency for $562 million, which closed on June 30th, 2016.

Results for 2016: American Capital did not file a form 10-K for 2016 and year ended December 31, 2016, due to the approved merger with Ares Capital Corporation. American Capital's stock price closed the year at $16.91 per share. By year-end, American Capital repurchased $2.2 billion of its stock since inception of its buyback program, approximately 46% of shares outstanding immediately prior to its share repurchase program.

Results of the Purchase: On December 15, 2016, ACAS shareholders approved the sale of American Capital to Ares Capital and the transaction was finalized on January 3, 2017. The purchase price totaled $4.1 billion or $18.06 per share. Adjusted for the stock dividend paid in 2009, which had the effect of a stock split, the purchase price of $18.06 per share translates to approximately $23.50 per share when compared to American Capital's price at the time of its IPO of $15.00 per share. In addition to the $23.50 per share purchase price, shareholders who purchased shares during its IPO and held them through to the January 2017 sale were paid $30.32 per share in dividends.

At the time of the sale of American Capital Mortgage Management, Gary Kain, Christopher Kuehl and Peter Federico continued with the company under its new ownership. At the time of the American Capital transaction Malon Wilkus, John Erickson, Gordon O'Brien, Samuel Flax, Roland Cline, Paul Hanrahan, Richard Santoroski and John Scheurer resigned their positions and departed from American Capital. Tom McHale and Brian Graff continued with the Company under its new ownership. Nathalie Faure Beaulieu and Tristan Parisot resigned their positions and departed from European Capital.

American Capital

Tuesday, February 6, 2018