Vita Group Limited (ASX: VTG) has seen its share price smashed again in early trading today, losing 11% to trade at $3.63.

After losing 13% of its value between Friday and Monday when the share price fell from $4.71 to $4.12, the ASX issued the company with a speeding ticket – asking Vita if the company had an explanation for the share price fall.

What was scary for shareholders was Vita’s response to the ASX – and the potential reason for the fall today.

Here’s what the company said:

“In line with normal commercial practice, on Friday 28th October 2016, Telstra briefed Vita Group and the broader Telstra licensed channel in confidence about some potential changes to the remuneration construct, reflecting a number of market and commercial factors. Vita and Telstra are currently in confidential discussions about those potential changes, and other strategic and tactical opportunities available to their partnership. Once the outcomes arising from these discussions can be reliably assessed, Vita will update the market, if required, in line with its disclosure obligations.”

In other words, a confidential discussion has potentially leaked out – and the company has advised the ASX that that is why it thinks the share price has fallen. And it may have had nothing to do with the reasons I suggested yesterday.

Will the corporate watchdog, the Australian Securities and Investments Commission (ASIC), take a closer look?

What is also concerning is that it appears that Telstra Corporation Ltd (ASX: TLS) may have its eye on Vita’s profit margins and the telco might want to claw some of that profit back. Telstra and Vita have an agreement where Vita runs just over 100 of Telstra’s retail stores, as well as a number of business centres for the telco.

Vita’s move to setup a men’s lifestyle retail store – SQDAthletic – could be a move to offset lower earnings from its Telstra contract. If that is the case, then management have some explaining to do for not being up front with shareholders.

Investors might want to wait to see what the outcome of the discussions are between Telstra and Vita Group before making a trade.

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Motley Fool writer/analyst Mike King owns shares in Vita Group. You can follow Mike on Twitter @TMFKinga

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.