Primedia detailed plans last week in a letter to its stockholders for the spin-off of its consumer guides division, but still has not yet pinpointed a date on which the spin-off will occur. A copy of the letter and its corresponding documents was filed January 11 with the Securities and Exchange Commission.

According to the filing, Primedia’s shares will undergo a “10-for-1 reverse stock split” just prior to the spin-off. It also says the new company will be called Consumer Source Inc. and it will incur some $525 million in debt as a result of its separation from Primedia. The reverse stock split will give Primedia shareholders one share for each 10 shares of the stock they hold. Such a split is used to drive up shareholder value. Following the spin-off, each shareholder will receive one share of Consumer Source stock for each share of Primedia stock they hold, according to the documents filed with the SEC.

Of the $525 million indebtedness Consumer Source will incur as a result of the spin-off, $20.9 million will be used to repay debt that Consumer Source owes to Primedia. The remaining $504.1 million will be distributed to Primedia through a dividend, which Primedia will use to reduce its outstanding debt. Primedia was carrying about $1.37 billion in long-term debt as of the third quarter of last year.

Primedia says it is spinning off the consumer guides division, which consists of free print and online guides serving the rental, automobile and other industries, because it is “fundamentally a different type of business than Primedia’s other businesses.” Whereas the majority of Primedia’s magazine business is editorial in nature and generates revenue from circulation, the consumer guides portion of the business consists mostly of advertiser content and does not generate revenue from circulation, Primedia told its shareholders in the letter.

The letter goes on to say that Primedia expects its stock price to increase as a result of the spin-off; the spin-off is expected to be tax-free; and Consumer Source expects to initially experience a net loss following the spin-off due to the significant indebtedness it will incur.

The spin-off of Primedia’s consumer guides group is the latest in a string of transformations the company has undertaken. The company sold off several of its assets last year including its crafts group to Enthusiast Media LLC, an entity controlled by affiliates of Sandler Capital Management; its gems group to Interweave Press; and the hunting, fishing and shooting assets from its outdoors group to Intermedia Partners.

Last month, the company said it planned to classify its education segment as a “discontinued operation in the fourth quarter” of 2006 while it explores strategic options for the assets of the segment. Industry sources have speculated that Primedia is looking to sell the segment.