ALROSA initiated bankruptcy proceedings against one of its subsidiaries, Alrosa-Yakutia, the company stated November 15, 2006. %% An ALROSA spokesman said that the move was due to "severe violations" made by Alrosa-Yakutias management. Alrosa-Yakutia has failed to meet its financial targets and to repay its debt to ALROSA, according to the company. %% ALROSA produces 99 percent of the uncut diamonds in Russia. The federal government is currently in the middle of a deal to raise its ALROSA stake to 50 percent plus one share from 37 percent. %% The government of the constituent republic of Yakutia (Sakha) holds 32 percent in ALROSA, while several Yakutia districts hold a combined stake of 8 percent. The region is expected to retain its stake after the federal governments stake increases, according to government officials.