MCG Capital Corporation (Nasdaq: MCGC) (“MCG”) announced today that Avenue Broadband LLC (“Avenue”), a majority-owned, control investment of MCG, has signed a definitive agreement to sell all outstanding shares of its capital stock to Telecommunications Management, LLC, a wholly-owned subsidiary of NewWave Communications, LLC. After transaction expenses, MCG’s cash proceeds in connection with the exit of this investment are expected to be approximately $50.4 million. Final closing of the sale transaction is subject to satisfaction of customary closing conditions, including regulatory approvals, and is expected to occur in March 2011. In December 2007, MCG made its initial debt and equity investment in Avenue.

“This sale, and the combination of the equity realization and repayment of our subordinated debt investment, is another step forward in our strategic plan to monetize equity investments to support the redeployment of capital into current yield-oriented investments to grow operating income and stockholder distributions," said Steven F. Tunney, Sr, MCG’s President and CEO.

Avenue is a cable television, high speed internet, and digital telephone service provider serving systems in Indiana and Illinois.

NewWave Communications is a leading communications services company serving more than 117,000 customers and offers video, voice and high-speed data services within smaller to mid-sized communities in Missouri, Tennessee, Kentucky, Illinois, Indiana, and Arkansas. NewWave is headquartered in Sikeston, Missouri.

About MCG Capital Corporation

MCG Capital Corporation is a solutions-focused commercial finance company providing capital and advisory services to middle-market companies throughout the United States. Our investment objective is to achieve current income and capital gains. Our capital is generally used by our portfolio companies to finance acquisitions, recapitalizations, buyouts, organic growth and working capital. For more information, please visit

Forward-looking Statements :

Statements in this press release regarding management’s future expectations, beliefs, intentions, goals, strategies, plans or prospects, including statements regarding MCG’s strategic plan to monetize junior capital to support the redeployment of capital into yield-oriented investments to grow operating income and stockholder distributions may constitute forward-looking statements for purposes of the safe harbor protection under applicable securities laws. Forward-looking statements can be identified by terminology such as “anticipate,” “believe,” “could,” “could increase the likelihood,” “estimate,” “expect,” “intend,” “is planned,” “may,” “should,” “will,” “will enable,” “would be expected,” “look forward,” “may provide,” “would” or similar terms, variations of such terms or the negative of those terms. Such forward-looking statements involve known and unknown risks, uncertainties and other factors including those risks, uncertainties and factors referred to in MCG’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010 filed with the Securities and Exchange Commission under the section “Risk Factors,” as well as other documents that may be filed by MCG from time to time with the Securities and Exchange Commission. As a result of such risks, uncertainties and factors, actual results may differ materially from any future results, performance or achievements discussed in or implied by the forward-looking statements contained herein. MCG is providing the information in this press release as of this date and assumes no obligations to update the information included in this press release or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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