Fitch rates Indika Inti Energi notes B

Fitch Ratings said it assigned long-term foreign- and local-currency issuer default ratings of B to PT Indika Inti Energi, along with an expected issue rating of B and an expected recovery rating of 4 to the proposed $250 million senior secured notes due in 2012 issued by Indo Integrated Energy BV and guaranteed by Indika and subsidiary PT Indika Inti Corpindo. The ratings are contingent upon receipt of documents.

The outlook is stable.

The ratings reflect Indika's status as a holding company that derives a major portion of its cash flow from dividends received from its 46%-owned associate, PT Kideco Jaya Agung, rather than from its own operations, Fitch said.

The ratings also reflect Indika's aggressive financial profile, which is characterized by high financial leverage. Even after adjusting EBITDA to include cash dividends from associates, Fitch said it estimates that Indika's debt-to-EBITDA ratio in 2007 will be about 6x.

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