Shares of Lee Enterprises Inc., the newspaper chain whose holdings include the Garden Island in Kaua'i, rallied today after the company refinanced debt to avoid a possible loan default.

The company said in a statement that it paid $120 million of $306 million of debt of its St. Louis Post-Dispatch LLC unit due in April and the remaining balance has been refinanced by current lenders until 2012.

In December, the Davenport, Iowa-based company wrote down the value of its intangible assets by $180 million and said the charge would result in technical default on the $306 million notes if lenders didn't waive a minimum net worth requirement. Lee's revenue has been falling because of the U.S. recession and readers' increasing use of the Internet to get news.

Shares rose 19 cents, or 58 percent, to 52 cents at 4:08 p.m. in New York Stock Exchange composite trading, the biggest jump since Dec. 19, 1989.