Primedia (PRM)

Company Explores Separation of its Businesses

In late 2005, the Company announced that its Board of Directors authorized management, along with advisors Goldman Sachs and Lehman Brothers, and counsel Simpson Thacher & Bartlett, to explore the separation of its businesses via a tax-free spin-off into two separate publicly-traded companies. The plan being contemplated would spin-off PRIMEDIA’s Consumer Guides Segment. In furtherance of the assessment of a potential spin-off, the Board of Directors approved the filing of a ruling request with the Internal Revenue Service and a Form 10 with the Securities and Exchange Commission (“SEC”). Both the IRS ruling request and Form 10 have been filed. Although the Board has taken these additional steps, there has been no final decision on whether to complete the spin-off.

Company Explores Separation of its Businesses

In late 2005, the Company announced that its Board of Directors authorized management, along with advisors Goldman Sachs and Lehman Brothers, and counsel Simpson Thacher & Bartlett, to explore the separation of its businesses via a tax-free spin-off into two separate publicly-traded companies. The plan being contemplated would spin-off PRIMEDIA’s Consumer Guides Segment. In furtherance of the exploration of the potential spin-off, the Board of Directors approved the filing of a ruling request with the Internal Revenue Service and a Form 10 with the Securities and Exchange Commission. The IRS ruling request has been filed and it is anticipated that the Form 10 will be filed during the third quarter. Although the Board has taken these additional steps, there has been no final decision on whether to complete the spin-off and there can be no assurances that a spin-off will occur.

In the fourth quarter 2005, the Company announced that its Board of Directors authorized management, assisted by outside advisors, to explore the separation of its businesses via a tax-free spin-off into two separate publicly-traded companies. The plan being contemplated would separate Primedia’s Consumer Guides Segment from Primedia’s Enthusiast Media and Education Segments. The transaction is anticipated to take the form of a tax-free dividend of shares in the spun-off company that would be distributed pro rata to all Primedia shareholders. The Company’s management continues to examine all of the relevant issues before making a recommendation to the Board of Directors. The outside (non-KKR) directors are also meeting independently with their advisors to consider the possible spin transaction. The Company will make an announcement when any determinations are made by its Board of Directors.