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Fitted from a training corpus of text documents by a generalization of the Expectation Maximization algorithm, the utilized model is able to deal with domain{specific synonymy as well as with polysemous words. In contrast to standard Latent Semantic Indexing (LSI) by Singular Value Decomposition, the probabilistic variant has a solid statistical foundation and defines a proper generative data model. Retrieval experiments on a number of test collections indicate substantial performance gains over direct term matching methods as well as over LSI. 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