Lossmaking Cabletalk is hopeful it can retrieve some value from its troubled telecommunications contracting business.

The company is today due to reveal the result of discussions with a potential partner for its telco business Astute.

Shares in Cabletalk tumbled to 3c this month after the company announced it had lost a key contract with TelstraClear in the South Island.

Its stock has taken several hits since trading at a high of 52c a year ago.

Cabletalk chairman Ross Keenan said the company is "still alive" and the board was still in discussions with a potential partner.

"The shift in emphasis has had to be to see what we can retrieve from the telecommunications side," Mr Keenan said.

He said the potential partner had requested a confidentiality agreement be extended from Monday to the end of this week.

"I've agreed to that because we're pretty close to reaching a sensible agreement on some aspects of the business."

The company is handing over its South Island business to Downers, which won the TelstraClear contract. About 40 staff will transfer from Cabletalk to Downers by the end of this month.

The change is a signal to Cabletalk that it is likely to lose TelstraClear's North Island work when its contract comes up in October.

Cabletalk specialises in the backup and delivery of telecommunication services and TelstraClear is its main customer. The company also has an electronic security system service called Fortlock.

Cabletalk's major shareholders are a group of investors listed in the New Zealand Central Securities Depository who hold 19.8%; Ross Watton who holds 16.8% and the company's managing director Peter Wilson who holds 3.8%.