BrOI. Source: Convergência Digital
CartaCapital editorializes against the merger of Oi and Brasil Telecom.
The magazine has been an implacable foe of banker Daniel Dantas since he was indicted for wiretapping competitors, government officials and journalists, including journalists at the newsweekly edited by the serial Brazilian newsweekly founder, Mino Carta.
It is a byzantine affair that make the Hewlett-Packard corporate espionage case look like a case of mildly malicious gossip overheard by chance at the corporate water cooler.
Talvez ainda chegue o dia em que um prócer do Partido dos Trabalhadores proponha a inauguração de um busto do banqueiro Daniel Dantas em alguma praça importante do País. Não seria surpresa. Em nome dos “interesses nacionais”, que costuma justificar as maiores barbáries e falcatruas, o governo Lula prossegue incólume no propósito de patrocinar a compra da Brasil Telecom (BrT) pela Oi. É possível apontar muitos ganhadores nesta operação. Além de Dantas, os principais acionistas da Oi, Carlos Jereissati e Sérgio Andrade. Quanto aos interesses nacionais e os consumidores, restam dúvidas sobre quais vantagens levariam nesta.
The day may come when the Workers’ Party (PT) will propose putting up a bust of Daniel Dantas in some important public square here in Brazil. It would not be surprising. In the name of “national interests,” often used to justify the most heinous acts of barbarism and fraud, the Lula government remains steadfast in its intention to sponsor the sale of Brasil Telecom to Oi. There are many winners in this transaction, among them Dantas and the principal shareholders in Oi, Carlos Jereissati and Sérgio Andrade. As to the national interests and consumers, doubts remains about what advantages they will gain.
Jereissati, a former Senator, has a son who is a prominent spokesman and former national chairman of the opposition PSDB in the Congress, representing Ceará, where he was governor until 1991, handing off to Ciro Gomes, a former Toucan now representing the PSB (Socialists).
The father’s Wikipedia profille says terribly, terribly unkind things about him at the moment. His staffers will probably tumble eventually and restore the glowing praise. That’s Wikipedia for you.
Andrade heads a leading civil construction and public works contractor, Andrade Gutierrez, a family-controlled business founded in 1948.
Até a noite da quinta-feira 24, estavam praticamente acertados os termos do acordo e a assinatura do negócio, que depende ainda de mudanças na Lei Geral de Telecomunicações (a legislação não permite a união de empresas concorrentes), deve sair antes de abril acabar.
As of the evening of April 24, the terms of the deal were settled for all intents and purposes, and the deal, which still depends on changes to the General Telecommunications Law (which does not permit the merger of competitors) should come sometime after the end of April.
No fim, os fundos de pensão e o Citibank, principais acionistas da BrT, aceitaram cessar todas as disputas judiciais que moviam contra o Opportunity de Dantas. Ao longo dos últimos anos, as fundações e o Citi reuniram provas suficientes para ingressar com ações diversas contra o banqueiro. A BrT cobra na Justiça brasileira. Seiscentos milhões de reais por danos administrativos e má gestão. Nos Estados Unidos, o Citi pede, no mínimo, 300 milhões de dólares por motivos semelhantes.
In the end, the pension funds and Citibank, the principal shareholders in BrT, agreed to drop all lawsuits against Opportunity and Dantas. In the last few years, the funds and Citi gathered enough evidence to file a number of suits against the Bahian banker. BrT is suing in the Brazilian courts for R$600 million in damages for mismanagement. In the U.S., Citi is asking for at least $300 million for similar reasons.
I am not exactly clear yet whether the shareholders agreement just signed applies to both Brazilian and U.S. lawsuits. The money put up by Oi to compensate the litigants in exchange for dropping their suits comes nowhere close to the total amount at stake in both jurisdictions.
Let me check on that.
BrOi would have combined gross revenues in the same ballpark as the Spaniards. Will the Mexicans now try to snap up the Italians (TIM)?
O acordo, ressalte-se, não interrompe processos na Comissão de Valores Mobiliários (CVM) nem o caso Kroll, em andamento na 5ª Vara Federal de São Paulo, onde Dantas é acusado de comandar uma quadrilha de espionagem armada para bisbilhotar a vida de desafetos e concorrentes do Opportunity. Não cessam, mas, principalmente o que tramita na CVM, ficam bastante enfraquecidos.
It should be noted that the settlement does not affect proceedings at the securities regulator, the CVM, nor the Kroll case, which continues at the Fifth Federal Bar in São Paulo, where Dantas is accused of commanding a spy ring set up to nose around in the lives of opponents and competitors of Opportunity. These proceedings will continue, but the CVM cases especially will be weakened considerably.
Why would it weaken the CVM disciplinary proceedings, I wonder? The CVM has already sanctioned other Dantas associates, including his sister, in an unrelated but similar matter. See
The criminal charges are the most interesting part of the case, to my mind. Kroll is suing its former associate, Frank Holder (Veja magazine’s source on the “dossier” story about the nonexistent bribe-stuffed offshore bank accounts of senior Brazilian officials) in a bid to show that what Holder allegedly did was part of a parallel contract with Dantas, though the Ferrell firm, and not part of his work for Kroll.
Holder claims he left Kroll because it was disloyal to Dantas, leaking confidential information to Citi that caused Citi to turn on Dantas. Kroll then signed him to a consulting contract to continue looking after the Brasil Telecom case, but he allegedly signed a parallel contract with Ferrell for other services — presumably the services that got Kroll and Holder in deep (criminal indictment) trouble in Brazil. See
Holder allegedly went to work for the Ferrell law firm while still under contract to Kroll, and, if he engaged in illegal acts of blackmail, forgery, and espionage, allegedly did so for that new employer, according to court filings.
But who really knows at this point?
Ferrell has an interesting history, some of it recounted in:
Rudolph, Robert C. The Boys from New Jersey: How the Mob Beat the Feds. New York: William Morrow and Company Inc., 1992.
The father of the current senior partner dropped dead of a heart attack in the middle of a historic mafia trial in which the jury took all of ten minutes to declare the entire Soprano crime family not guilty.
O mais surpreendente é que Dantas não só não terá de desembolsar nenhum tostão pelo fim das pendências judiciais, como ainda receberá uma boa quantia por conta do acerto. Os acionistas da Oi aceitaram pagar 200 milhões de reais à BrT e 150 milhões de reais ao Opportunity pelo acordo de paz, conforme noticiou a revista eletrônica Teletime News. Uma assembléia de acionistas da Brasil Telecom ainda precisa aprovar a proposta.
What is most surprising is that not only will Dantas not be required to pay a single cent to settle the lawsuits, but will receive a good deal of money from the settlement. Oi shareholders agreed to pay R$200 million to Brasil Telecom and R$150 million to Opportunity to secure the peace, according to Teletime News. A general meeting of Brasil Telecom shareholders still has to approve the proposal.
Ninguém deve se iludir quanto à natureza dessa negociata. Ela não é simplesmente um acerto entre agentes privados em busca de eficiência e rentabilidade em seus negócios. Quem moveu a roda da fortuna nesse caso foi o BNDES, por ordens do Palácio do Planalto. O banco estatal vai financiar uma boa parte da criação da “supertele”, como vem sendo chamada a empresa resultante da união da Oi com a BrT. Deduz-se, portanto, que a parcela a ser paga a Dantas será deduzida da quantia repassada a juros camaradas por uma instituição oficial. Como o governo tem relacionado todo e qualquer projeto federal à idéia do Programa de Aceleração do Crescimento, nada mais justo que chamar essa triangulação de PAC do Dantas. Fica a pergunta: quem assumirá a paternidade ou a maternidade do pacote?
No one should delude themselves about the nature of this murky deal. This is not simply a negotiation among private parties in search of profitability and efficiencies for their businesses. It was BNDES that pulled the strings to make this deal happen, on orders from the federal executive. The state development bank will finance a good chunk of the deal to create the “supertelecom” … It can be inferred, therefore, that the money to be paid Dantas will be subtracted from the amount paid in by a public financial institution. Since the government insists on tying every single federal project to its growth acceleration program, the PAC, it seems appropriate to call this deal the “PAC of Dantas.” The question remains: Who will assume the paternity of this deal?
O governo Lula está, assim, prestes a repetir o modelo equivocado dos tempos de Fernando Henrique Cardoso. No período que precedeu o vexame do apagão, o BNDES desembolsou 21 bilhões de reais para o setor elétrico. Desse total, apenas 7 bilhões foram injetados em projetos de expansão da oferta de energia, tão necessários naquele momento. O resultado, catastrófico, todo mundo viu em 2001.
In this way, the Lula government is about to repeat the erroneous model of the Cardoso years. In the period preceding the rolling blackouts [in the last years of the Cardoso administration], BNDES pumped R$21 billion into the electrical sector. Of that, R$7 billion were injected into project designed to increase the supply of energy, sorely needed at the moment. We all saw the catastrophic results in 2001.
Agora estamos diante de uma tremenda perspectiva de crescimento sustentado e a demanda por financiamento industrial não pára de crescer. Mesmo assim, o BNDES prefere bancar um processo de fusão de vantagens duvidosas e bastidores nebulosos.
We are now faced with tremendous prospects for sustained economic growth and the demand for financing for industrial undertakings continues to grow. Even so, BNDES prefers to bank a merger offering dubious advantages and murky backroom dealings
Além do mais, não é que o banco de fomento esteja nadando em dinheiro. Na terça 22, a Câmara dos Deputados teve de aprovar um aporte do Tesouro de 12,5 bilhões de reais ao BNDES para que a demanda por empréstimo seja atendida neste ano. Qualquer cidadão razoavelmente informado poderá listar ao menos uma centena de projetos muito mais prioritários e fundamentais ao desenvolvimento do que a criação da BrOi.
Among other things, BNDES is not exactly swimming in cash. On April 22, the lower hous of Congress had to approve a supplementary allocation from the Treasury of R$12.5 billion to BNDES to keep up with the demand for loans. Any reasonably well informed citizen could list at least a hundred projects much more urgent and fundamental to national development than the creation of BrOI.
The argument for the urgency of the deal is creating a counterweight to the Spanish and Mexican conquistadores, Telefónica and Telmex (Slim), who tend to engage in rent-seeking behavior on a mass scale.
Universalization of broadband, network sharing, and the like are supposed to create jobs, and competition and economies of scale are supposed to create price wars that move the digital inclusion project along.
This is not a totally insane strategy, I tend to think (based on what little I know, mind you.)
The PAC program and BNDES seem clearly calculated to bust up monopolies, duopolies and oligopolies (although even with the rise of Record, Brazilians are still stuck with a Globo-Record duopoly in TV news and entertainment, and you will not get great odds on the proposition that public TV (the Tupi BBC) will help much.
CC, at any rate, should explain to me why these effects are not likely to come about, and why the BNDES funding is allegedly excessive. I sometimes wonder whether the (understandable) bode they have for Dantas does not interfere with their objectivity to a degree.
Lula, em sua popularidade inabalável, e seus principais assessores deveriam atentar para um fato grave dessa situação, já mencionado por CartaCapital diversas vezes. Há um claro conflito de interesses que deveria manter o Palácio do Planalto longe dessa negociação: a Oi é sócia do filho do presidente da República, Fábio da Silva, em uma produtora de conteúdo para a tevê.
Lula, with his unsinkable popularity, and his principal advisors ought to pay more attention to a very serious aspect of this situation, which this magazine has pointed out on many occasions. There is a clear conflict of interests that ought to keep the executive as far from this deal as possible: Oi is a partner of the President’s son, Fábio da Silva, in a production company that creates TV content.
I think that would be (the abysmal youth-oriented) PlayTV, which is taking aim at cutting off a chunk out the market controlled by Abril’s (abysmal, youth-oriented) MTV.
Nada justifica que qualquer nesga de pudor e de postura republicana seja simplesmente atropelada. Nem supostos “interesses nacionais” nem a aparente certeza de que altos índices de aprovação são uma licença para se praticar qualquer ato.
Nothing justifies simply trampling on the last vestiges of propriety and republican virtues. Not alleged “national interests” or the apparent certainty that high approval ratings mean that everything is permitted.
Well, CC is entitled to its opinion, at any rate — which it at least is careful to confine to a section loudly labeled “this is our opinion.”
It is a little weird to see the Forces of Squid naming a minister of communications who is a former Globo executive. It is not as though Globo has returned the favor in terms of favorable coverage of the government.
Stay tuned for more reaction.
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