The boardroom tension is real. Across Nigeria right now, corporate executives are making a striking choice: taking on expensive debt rather than raising equity, even when the numbers do not obviously favour borrowing. It is a trend playing out quietly in finance meetings from Lagos Island to Abuja, and it says a lot about how Nigerian business leaders feel about giving up ownership stakes in their companies.
The reasoning is not purely financial. For many founders and majority shareholders, diluting equity means diluting control, and in Nigeria's business culture, control is everything. Debt, no matter how costly, has a ceiling. You pay it back and it is gone. Equity, once issued, reshapes the power structure of a company permanently, and that is a trade many executives are simply not willing to make.
There is also the question of market conditions. Nigeria's equities environment has not made it easy or particularly attractive to go the public route. Between currency volatility, thin liquidity on the Nigerian Exchange, and investor appetite that remains cautious, raising equity can feel like a long road with uncertain rewards. Debt, by contrast, is predictable, even when it is pricey.
What this means for the broader economy is worth watching. Companies carrying heavy debt loads are more vulnerable when interest rates shift or revenue dips, and Nigeria has seen plenty of both in recent years. The pattern raises a quiet question: at what point does the preference for control start costing businesses more than a diluted shareholding ever would?
Originally published by BusinessDay.