Ameritrans Capital Corporation Announces Agreement for Sale of Taxicab Medallion Portfolio

  
    
  
  
    
      Ameritrans Capital Corporation (NASDAQ: AMTC, AMTCP) today announced 
      that Ameritrans and its wholly owned subsidiary, Elk Associates Funding 
      Corporation, executed a definitive agreement with Medallion Financial 
      Corp. and its wholly owned subsidiary Medallion Bank for the sale of 
      substantially all of Elk’s taxicab medallion 
      loans. Another subsidiary of Medallion Financial, Freshstart Venture 
      Capital Corp., will purchase certain other small business loans at the 
      closing. The transaction is anticipated to generate approximately $31 
      million in gross proceeds. The transaction is subject to customary 
      closing conditions, and is subject to certain terms and conditions, 
      including approval by Ameritrans shareholders. The Company expects to 
      distribute definitive proxy materials to shareholders as soon as 
      practicable which will set forth in detail the closing conditions and 
      terms and conditions of the transaction. The transaction is expected to 
      close no later than October 15, 2008.
    
    
      Ameritrans expects to use substantially all of the net proceeds from 
      this transaction to continue to build its portfolio of corporate loans, 
      consistent with its strategy of repositioning and growing its portfolio 
      as well as reduce its outstanding borrowings, pay operating expenses, 
      and for general corporate purposes.
    
    
      “We are delighted to announce the sale of our 
      medallion portfolio,” said Michael Feinsod, 
      President of Ameritrans. “Ameritrans and Elk 
      are proud to have built a profitable and vibrant medallion finance 
      business over the past 28 years. This transaction enables Ameritrans to 
      continue the expansion of our senior-secured, middle market corporate 
      loan portfolio. Given the continued stress on the credit markets, we 
      continue to see excellent opportunities to grow the portfolio and 
      generate attractive risk adjusted returns for our shareholders.”
    
    
      Ameritrans Capital Corporation is an internally managed, closed-end 
      investment company that has elected to be regulated as a business 
      development company (“BDC”) 
      under the Investment Company Act of 1940, as amended. Ameritrans 
      originates, structures and manages a portfolio of medallion loans, 
      secured business loans and selected equity securities. Ameritrans' 
      wholly owned subsidiary Elk Associates Funding Corporation is licensed 
      by the United States Small Business Administration as a Small Business 
      Investment Company (SBIC) in 1980. The Company maintains its offices at 
      747 Third Avenue, 4th Floor, New York, NY 10017.
    
    
      This announcement contains forward-looking statements within the 
      meaning of the Private Securities Litigation Reform Act of 1995. Such 
      statements are subject to certain risks and uncertainties that could 
      cause actual results to differ materially from those presently 
      anticipated or projected. Ameritrans Capital Corporation cautions 
      investors not to place undue reliance on forward-looking statements, 
      which speak only as to management's expectations on this date.