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AirAsia Indonesia Expects to Raise US$150/200 Million with IPO

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AirAsia Indonesia has selected which underwriters it will use for its initial public offering (IPO).

Credit Suisse and CIMB Securities Indonesia will act as our Joint Lead Underwriters. Through IPO, we attempt to attain the appropriate capital structure necessary to support future operations. We expect to raise US$ 150 million to US$ 200 million, said Dharmadi, President Director of AirAsia Indonesia.

The shares are expected to begin trading in Indonesian Stock Exchange in the fourth quarter of 2011.

Proceeds from the IPO will be used to facilitate the planned expansion in the airlines fleet of aircraft and to augment the level of its working capital. In addition, AirAsia Indonesia wishes to make shares available to employees as a reward for their past contributions and loyalty.

We also wish to further enhance our brand recognition and corporate profile. Our IPO will mark the success already achieved by AirAsia Indonesia as the leading regional aviation player in the low- ost category, Dharmadi added.

Commenting on the carriers plan to go public, Dharmadi said that Indonesias healthy economic expansion provides the airline a massive growth opportunity.

General outlook on the Indonesian economy remains positive in 2011; propped up by strong consumer spending, commodity exports, investments, and rising incomes. Indonesia archipelago, being the largest island complex in the world with a population of over 240 million, makes an attractive market for air travel. We are in a prominent position to further expand our business, he said.

AirAsia Indonesia has a flying history of 6 years in domestic as well as international skies, and contributes significantly to tourism development, economic growth and local employment.

The airline recorded total revenue of IDR 2.764 billion in 2010, enjoying an increase of 37% y-o-y and a profit after tax of IDR 474 billion, up by 351% y-o-y. Load factor was at 77% with passenger volume growth of 13% y-o-y. In 2010, ancillary income contributed significantly to the airlines bottom line. Ancillary spending per passenger increased to IDR 123.308, recording 60% growth y-o-y.

We will continue to strengthen our international dominance in the market. We have plans to return to domestic routes once we have established a strong international connectivity. We are confident that our robust financial performance and stability, combined with the right future growth strategies, will whet investors appetite, Dharmadi concluded.

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