The YK Modi tea company had taken up a restructuring exercise that was to have seen it exit non-tea ventures. Apart from MKTL, the company is yet to sell Rossell Financial Services Ltd, which had been termed a "bad-buy" by then managing director D Atal in 1997.

Rossell Industries had called an extra-ordinary general meeting of its shareholders on August 20, 1997, to pull out of the financial services wing.

The list of subsidiaries in Rossell's latest annual report has two new names -- MKTL and Great Eastern Energy Corp, which was set up to undertake coal-bed methane exploration.

Rossell has a holding of around 52 per cent in MKTL before it was de-subsidiarised as part of therestructuring process. The annual report for the year to December 31, 1998, shows that Rossell holds a stake of 49.99 per cent directly in MKTL and 5.57 per cent via subsidiaries RIL Investments Ltd.

In MKTL, partner Korea Telecom refused to bring in further funds, following which Rossell had to increase its equity investment to Rs 21 crore from the earlier level of Rs 10 crore. This was done to meet the losses.

During the year, MKTL managing director Soo Sung Jung -- a nominee of Korea Telecom -- had resigned together with joint managing director Rajiv Agarwal, director Jae Man Choi and Industrial Investment Bank of India's nominee BK Dutta.

MKTL has a share capital of Rs 20.73, out of which shares worth Rs 12.40 crore have been allotted. Its net loss was Rs 13.47 crore as on March 31, 1998. As Rossell's subsidiary in 1995-96, the paging outfit had recorded a loss of Rs 2.46 crore on a share capital of Rs 10 crore.

MKTL's secured loan is Rs 18.17 crore out of a total loan component of Rs 20.05 crore.In 1995-96 annual report, it was noted that MKTL, which had taken a Rs 9 crore secured loan from its parent, had in turn advanced Rs 1.75 crore to other companies, which were stated as "recoverable".

The foreign collaborator of Great Eastern Energy Corp, Methane India Energy Corp BV, has quit the project since it could not bring in further funds.

Two of the other three wholly-owned subsidiaries -- Rossell Financial Services Ltd and Bokel Investments Ltd -- have recorded losses of Rs 30,000 and Rs 10.40 lakh respectively for the year to December 31, 1998.

The parent has increased total advances by Rs 1.1 crore during the year. Total advances towards equity participation from the parent is now Rs 7.80 crore and share allotment is still pending.

Rossell Financial, in turn, advanced Rs 70 lakh during the year to other companies for participating in their equity. Its total advances of this nature went up to Rs 7.16 crore on December 31, 1998, from Rs 6.31 crore in the previous year.

Similarly, Bokel hadbeen advanced around RS 2.2 crore during the year by Rossell towards equity participation. Neither the loan of Rs 2.2 crore advanced during 1998 nor the earlier advances of Rs 6.78 crore have been converted into equity. In turn, Bokel's loans to other companies for participating in their equities now stands at Rs 5.32 crore up from Rs 5.11 crore in 1996-97.