A MODERATING EFFECT OF INFLATION ON THE IMPACT OF CORPORATE OWNERSHIP STRUCTURE ON THE FINANCIAL RESILIENCE OF ZOMBIE FIRMS IN SUB-SAHARAN AFRICA

This study looks at how inflation changes the way company ownership affects the financial strength of struggling companies in Nigeria, a major country in Sub-Saharan Africa. Using ideas from theories about company management and the economy, it asks whether managers owning shares and a few people owning large shares help these weak companies become stronger, as shown by the Price-to-Earnings (P/E) ratio, and how these links change when inflation is high. The study uses past records, analysing data from 20 chosen weak companies in Nigeria's manufacturing sector, over 2015–2024, totalling 120 company-year cases. Methods include basic descriptions, looking at relationships between numbers, and using a type of regression analysis that adds inflation as a factor to see if it changes other results. The findings show that only inflation strongly predicts financial strength (B = 12.589, p = 0.028), having a clear positive effect. Manager ownership (B = 2.502, p = 0.224) and concentrated ownership (B = 1.721, p = 0.199) also have positive effects, but these are not significant. Inflation's moderating effect is partly supported: the combined results for both ownership types are negative (MOWN×INFL: B = -0.158, p = 0.194; CONC×INFL: B = -0.125, p = 0.119), meaning high inflation can weaken any benefits from concentrated ownership, though these aren't strong findings. The overall model explains little of what affects the companies' market values (R² = 0.085), so there are other important factors not studied here. The study finds that in Nigeria’s unpredictable economy, the market's views about the financial strength of struggling companies are mostly shaped by inflation, more than by who owns the company. Standard ways of running companies are less useful in this situation, showing that companies need to adapt their strategies and policies to this context. The study adds to the limited research on weak companies in Africa and advises managers, investors, and policymakers working in high-inflation countries. It makes suggestions for better company management when the economy is stressed and points out future research areas.