Bunge's deal to buy Brazil soy plants comes undone amid legal wrangle

SAO PAULO (Reuters) - Bunge’s agreement to buy two soy-processing facilities in Brazil has been canceled amid a protracted, multi-jurisdictional legal battle involving Imcopa, the seller of the assets, according to documents related to the disputes seen by Reuters.

The U.S.-based grain trader, which declined to comment on the cancellation, signed a commitment to buy the two facilities from Imcopa in May 2020. The deal would have increased the number of Bunge oilseeds processing plants in Brazil, the world’s largest soybean producer and exporter, from eight to 10.

Imcopa, which is attempting to divest the assets in a bid to emerge from bankruptcy, formally communicated the expiration of the agreement with Bunge to the court overseeing proceedings on March 24, according to documents seen by Reuters. It requested 120 days to resume the search for a new buyer.

The seller told the court that legal disputes involving Cervejaria Petrópolis, the brewer that had a lease agreement to operate the two plants wanted by Bunge, as well as interference from Minefer and Triana, two Panama-based entities, which claim to be creditors of creditors of Imcopa - unravelled the deal.

Imcopa did not respond to requests for comment.

Imcopa accused Cervejaria Petrópolis of being in breach of their leasing contract set to end in 2024. Cervejaria Petrópolis declined to comment.

The brewer’s owner, Walter Faria, holds 100% of Panama-based Minefer and Triana, according to public records pertaining to an unrelated court case involving the businessman.

Under the terms of the now-defunct deal, Bunge agreed to take on some 1 billion reais of debt ($174 million) attached to the soy plants, and pay 50 million reais for the facilities, which can process about 1.5 million tonnes of soybeans per year.

Reporting by Ana Mano; Editing by Bernadette Baum and Aurora Ellis