Hutchison Whampoa is looking to stem losses of its Australian mobile arm, with talks under way to sell back its re-sale subscriber base to Optus Mobile. The move, if realised, would signal the first contraction in Hutchison's overseas telecommunications business amid an increasingly difficult environment. In an announcement to the Australian Stock Exchange yesterday, Hutchison Telecommunications Australia (HTA), a 58 per cent-owned subsidiary of Hutchison Whampoa, confirmed it was in talks with Singapore Telecommunications' Optus Mobile. HTA is a reseller of Optus services. It said no agreement had been reached in the discussions. However, the Australian Financial Review reported that HTA would announce the sale by next Monday as part of a overhaul and cost-cutting exercise. The action, which involved selling back 156,000 of 279,000 customers, represented about 70 per cent of Hutchison's A$212.5 million (about HK$841.5 million) revenue for the six months to June 30, the newspaper said. HTA has 123,000 subscribers using the code division multiple access network launched 15 months ago. However, the newspaper report suggested that HTA could look to sell or even wind down the network, focusing on the development of its third generation (3G) network, which is scheduled to start operating in the fourth quarter of next year. A Hutchison spokesman declined to comment on a possible restructuring of its subsidiary. A SingTel spokesman said: 'Until something matures, it is for the time being still a discussion.' HTA, listed in August 1999, has never been a profit-making business and lost A$91.1 million in the first half. The Financial Review report said HTA was expected to lose A$892 million by December 2003 in its start-up phase. The smallest mobile operator of four in Australia has been aggressive in its expansion, having acquired 3G spectrum via auction for A$671 million, largely funded by parent Hutchison Whampoa. It also secured a A$250 million investment from Telecom New Zealand in exchange for a 19.9 per cent stake in its Australian 3G business. Hutchison Whampoa committed almost A$1 billion to its subsidiary, underwriting A$323 million worth of rights issues in May last year, on top of the loan it made to facilitate the spectrum purchase. However, HTA's share price remains near historic lows, closing unchanged at 28.5 Australian cents yesterday. With a market capitalisation of A$193 million, HTA has come down more than 95 per cent from its peak of more than A$4 billion. Last month founder Barry Roberts-Thomson resigned in favour of Kevin Russell. Mr Russell's promotion was seen by the market as the parent company exercising greater control amid concerns about widening losses as it pours money into building new networks.