Moody's ups Medco Energi

Moody's Investors Service said it upgraded the issuer rating of PT Medco Energi Internasional TBK (Medco) to B2 from B3 and upgraded the senior unsecured rating of notes issued by MEI Euro Finance Ltd., a wholly owned subsidiary of Medco, to B2 from B3.

The outlook on both ratings is stable.

Moody's said the upgrade reflects the fact that uncertainties over the Medco's acquisition of Novus and the risk associated with the financing of the transaction have been cleared.

The acquisition was completed on Aug. 20, 2004 and was partially financed by a $200 million bridge facility. This bridge facility was subsequently repaid of $150 million, using the proceeds from the disposal of Novus' Australian assets and part of Indonesian assets to Santos for $110 million, and one of its U.S. assets, Stratton, to Apache for $45 million. The maturity of the remaining $50 million has been extended by 15 months until March 2006.

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