SAO PAULO, May 30 (Reuters) - A legal dispute over

control of bankrupt Brazilian soy processor Imcopa is

threatening to derail a court-run auction for two crushing

plants in southern Brazil that had previously drawn interest

from major traders Bunge and Cargill.

R2C Investimentos, an asset manager that appointed Imcopa's

former management, is challenging what it called

"irregularities" related to the July 3 auction, and vowed in a

statement to warn potential bidders of "the illegalities of the

competitive process."

An attorney for brewer Cervejaria Petropolis, whose owner

acquired most of Imcopa's defaulted loans through funds in

Brazil and abroad, said ongoing litigation in multiple

jurisdictions should not affect the auction aiming to raise some

1.7 billion reais ($300 million).

The auction marks the latest attempt to sell the two

Imcopa crushing plants located near soy-rich regions and a large

port in Parana state. It is a rare acquisition opportunity in

Brazil, the world's largest soybean producer and a major soymeal

exporter. However, legal risks involved and current negative

crushing margins in Brazil may keep buyers at bay.

In February 2020, U.S. grains trader Bunge made the sole bid

for the two plants, which have annual crushing capacity of 1.5

million metric tons of soy and specialize in non-transgenic soy

processing. The bidding was run by a state bankruptcy court

overseeing Imcopa's restructuring since 2013.

The deal unravelled in 2021 amid the protracted court

battles involving Cervejaria Petropolis, which had a leasing

arrangement to operate the plants at the time.

Bunge, which never took control of the assets, declined to

comment.

In 2023, Cargill advised the court of its potential interest

in Imcopa's assets, seeking clarification about the liabilities

involved, documents seen by Reuters at the time showed, but a

deal did not materialize.

Cargill declined to comment on Imcopa's new auction.

After Bunge's failed takeover attempt, it maintained an

arrangement with Cervejaria Petropolis to supply soybeans to

Imcopa in exchange for finished products. The brewer's attorney

said that deal lapsed last year, when both plants were idled for

maintenance.

Cervejaria Petropolis has run Imcopa since March 2024, when

the bankruptcy court gave it control after a criminal probe

targeting former Imcopa executives, the brewer said at the time.

That sealed investigation is still underway. R2C has denied

any wrongdoing involving Imcopa's former management.

($1 = 5.6584 reais)