Talk Radio 950 KOZE-AM|Lewiston, Idaho

The Internal Revenue Service has ruled that Potlatch Corporation’s plan to separate most of its manufacturing from its timber holdings will be tax-free, paving the way for the Dec. 17 spinoff of Clearwater Paper.

Potlatch’s pulp, paperboard, tissue products and Lewiston wood products operations will constitute Clearwater Paper, while Potlatch will maintain its timber holdings and its lumber operations in places other than Lewiston.

Company officials say the biggest difference come spinoff time is that shares of the real estate investment trust will be sold independently of those for what previously had constituted the majority of Potlatch’s manufacturing operations. Potlatch shareholders will receive one share in Clearwater Paper for every 3 1/2 shares they own of Potlatch stock for no charge if they own the stock at the close of business on Dec. 9.

Another change is in top management as Potlatch will keep its team, and Clearwater Paper will have its own roster of executives, headed by Gordon Jones, the former chief executive officer of Blue Ridge Paper Products in Asheville, N.C.