The Russian government has increased its stake in Alrosa from 37% to 47.7% by getting state-owned Vneshtorgbank to buy 10.7% of the shares from minority shareholders, according to reports by Russian newspaper Kommersant. The government�s goal is to increase its shareholding to more then 50%, which it plans to do in part by contributing its stake in Yakutalmaz to Alrosa�s authorized share capital.

The second largest shareholder in Alrosa, the autonomous Republic of Yakutia (Sakha), now has a 40% stake, including the 8% stake held by local regions within Yakutia. Kommersant reports that the republic wants to keep its stake without having to contribute additional assets, and is therefore disputing the Center for Professional Assessment�s valuation of the company at $6.1 billion, or $30,300 per share, a comedown from last year�s estimate of $6.4 billion, or $32,300 per share, which Yakutian President Vladimir Shtyrov called inflated by at least $1.5 billion.

Galina Makarova, head of the republic�s property ministry, has written a letter claiming that the old Soviet accounting methods should be used to estimate Alrosa�s value instead of the international standards the Center for Professional Assessment used. Alrosa has more than 50 subsidiaries, and the Soviet accounting methods would exclude the largest of these, Alrosa-Nyurba, from the valuation. Yakutia also wants it taken into account that it was effectively forced to rent property to Yakutalmaz.

Makarova�s letter was sent to Alexei Kudrin, the Russian Minister of Finance and chairman of Alrosa�s supervisory board; Valery Nazarov, the head of the Federal Property Management Agency (Rosimushchestvo); and Alexander Kushel head of the Center for Professional Assessment. In reponse, PR officials at the federal Ministry of Finance told the newspaper that Yakutian representatives had voted in favor of the valuation.