UPDATE 1-Italy's Sorgenia hopes to strike debt deal with banks soon
* Sorgenia gross financial debt 1.863 bln euros at end-Jan
* Debt payments suspended with banks 61 mln euros end-Jan
* Financial autonomy 1 month if credit lines not renewed (Recasts, adds detail, background, byline)
MILAN, Feb 17 (Reuters) - Italian energy company Sorgenia, controlled by holding company CIR, hopes to strike a deal soon with lender banks to freeze payments on its debt as it seeks to turn around its loss-making business.
In recent months creditor banks have cancelled or frozen credit lines at Sorgenia, which is seeking a six-month freeze on debt payments to help it address a lack of growth and high indebtedness.
"If the credit lines are not renewed... Sorgenia could have financial autonomy of around one month," CIR said.
Sorgenia, 46 percent owned by Austrian utility Verbund , has already presented a new business plan to help start the debt restructuring process.
The company, which has financial debt of almost 1.9 billion euros ($2.6 billion) along with a further 304 million euros in endorsement debt, generates electricity and sells power and gas.
It has invested heavily in gas-fired power plants at a time when demand has languished because of the economic downturn and prices fallen.
CIR, controlled by the Italian De Benedetti family, said that the curtailment and cancellation of loans by the banks meant only one cash facility was currently available its unit.
"The situation is naturally causing considerable financial stress which, should it continue over time, could prejudice Sorgenia group's ability to conduct its business activity," it said.
The debt repayments suspended by Sorgenia with its creditor banks totaled 60.7 million euros at the end of January.
CIR said it was ready to do its part in the restructuring process under certain circumstances. Earlier this month Verbund rejected Sorgenia's call for funds.
Sorgenia's new 2014-2020 plan will focus on its core power generation business, while selling all its renewable energy assets as well as its exploration and production business.
Sorgenia holds 39 percent of power generation company Tirreno Power which had a debt pile of about 875 million euros at the end of January.
"To date Sorgenia has no commitment to support the financial and capital restructuring of Tirreno Power," CIR said.
($1 = 0.7298 euros) (Reporting by Stephen Jewkes; Editing by Steve Scherer and Eric Walsh)
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