Accounting errors that allegedly inflated the value of GSS’ Banco Panamericano are being probed by the country’s central bank after Santos was forced to ask for a 2.5 billion real ($1.5 billion) bailout to keep Panamericano from insolvency in November.
This has had a domino effect on Santos’ treasured TV network, Sistema Brasileiro de Televisao (SBT), the first building block in what became GSS — a collection of 40 companies covering gaming, car sales, hospitality, cosmetics, health insurance and banking.
The net has had to cut expenses at a time when it is fighting to regain its position as the country’s No. 2 network, a spot it lost in 2007. One of the net’s top talents, Hebe Camargo, who hosted a talkshow on SBT for 25 years, recently ankled.
Santos has put up GSS assets — not including SBT — as collateral for the loan, but that hasn’t stopped rival media companies from kicking the net’s tires.
Media group Ongoing, which owns Portugal’s TVI channel and newspapers in Brazil, has reportedly offered to buy SBT, but Santos refused to sell.
“If it is necessary, Santos will sell other companies in his group and keep SBT — that is his life project,” says media analyst Andre Mermelstein.
Santos is one of the most controversial figures in the Brazilian TV industry. Now 80, although he looks at least a decade younger, Santos is a self-made man who worked as a street peddler and radio and circus showman until 1962, when he was picked to host a TV talkshow that eventually evolved into “Programa Silvio Santos.”
In the 1960s and ’70s, the Sunday show was broadcast nationwide by various nets. He founded his own channel in Rio de Janeiro in 1975, and in 1981 got a license for a second channel in Sao Paulo, eventually forming SBT, a nationwide net that maintained Brazil’s No. 2 slot for decades.
In 2000, SBT inked output deals with Warner and Disney and a production deal with Mexico’s Televisa, leading some analysts to believe that SBT might overtake market leader TV Globo.
But advertisers remained mostly with TV Globo, and SBT eventually dropped the Disney and Televisa deals; now, SBT has fallen behind TV Record in the battle for second place.
“Silvio is a visionary, but he is absolutely unreliable. He changes SBT’s lineup every week and suspends the airing of series and telenovelas in the middle and without warning,” says a media analyst, who asked not to be named. “He has negotiated deals with companies, such as Telefonica and Endemol, and then changed his mind.”
Santos has vowed to continue to keep GSS on the same track. As he turned 80 on Dec. 12, he kept to his routine and recorded “Programa Silvio Santos.”
Looking forward, Santos has three years to begin paying the loan for Panamericano, which continues to operate. “He’s happy with the deal and doesn’t feel pressured,” Mermelstein says. “He’s passed on the trouble of paying this debt to his successors.”