* Needs to raise debt of at least $225 mln by May 25

* Shares up 5 percent

March 20 (Reuters) - Newspaper publisher Media General Inc agreed to a new debt repayment schedule with its lenders, giving the company a breather as it struggles with rising costs and dwindling advertising revenue.

The publisher of the Tampa Tribune and the Winston-Salem Journal said on Tuesday the maturity date of a $363 million debt facility had been extended in return for a partial repayment.

Media General, which had $658 million of long-term debt at the end of 2011, said last month it was exploring a sale of its newspaper operations.

Under the agreement, the debt-laden company will have to sell notes to raise at least $225 million by May 25.

Of this, a minimum of $190 million will be used to pay down the outstanding term loan.

"While interest costs will be higher in 2012, our amended credit agreement will provide Media General with more flexibility to operate, as well as expanded opportunities to reduce total debt," Chief Executive Marshall Morton said.

The company, valued at about $116 million, has posted a loss in seven of the last eight reported quarters. Print revenue comprised 49 percent of the company's 2011 revenue of $628.1 million.

Bank of America was the administrative agent on the transaction and Peter J. Solomon Company was the strategic adviser. J.P. Morgan will advise Media General on the note sale.

Shares of the Richmond, Virginia-based company rose 5 percent to $5.41 in afternoon trade on the New York Stock Exchange.

• A Permanent Economic Emergency