American Capital

About American Capital

In 1986, Malon Wilkus founded American Capital, starting with a focus on employee and management buyouts. The firm made its first investment in an employee-owned company in 1990. This early strategy laid the groundwork for what would become a novel experiment in the world of high finance. A pivotal moment arrived in August 1997, when American Capital went public, becoming the first private equity firm in the United States to do so. The IPO raised $155 million and transformed the company into a Business Development Company, or BDC. This structure opened up the traditionally exclusive world of private equity to public market investors. The company provided capital directly to middle-market companies for buyouts and growth, often taking a controlling stake. At its height, the firm managed assets worth over $100 billion. The company’s journey, however, faced significant hurdles, especially during the 2008 financial crisis which severely impacted its business model. After facing pressure from investors, American Capital initiated a strategic review. This ultimately led to a major event in 2017, when the company was acquired by Ares Capital for a total transaction value of about $4.1 billion. The sale marked the end of American Capital's two-decade run as a public entity, closing a unique chapter in financial history.