BOSTON (Reuters) - Corporations that have resisted activist investors' prodding to sell off divisions, take on new debt, and make special dividend payments are getting some unexpected help from rapidly declining credit markets.

As credit tightens and people bidding on divisions earmarked for spinoffs find it hard to borrow, some of the $1.75 trillion hedge fund industry's roughly 100 activist investors may be hobbled in the weeks ahead, bankers, academics and hedge fund managers said this week.

"Investors who are now trying to rely on financial engineering and putting more debt onto the books are going to have a hard time. Boards will be very critical," said Hossein Kazemi, a professor of finance at the University of Massachusetts who is also the academic liaison to the Chartered Alternative Investment Analyst Association.

Many investors, however, pursue a more quiet form of activism by buying big stakes in companies in the hope of getting a seat on the board and influencing management that way. Fund manager Edward Lampert, known as a long-term investor, recently raised his stake in Citigroup by 63 percent.

University of Massachusetts's Kazemi said some people may become a type of private equity investor whereby they would make investments, then work with management to improve performance and wait, sometimes for years, for a payoff.

Ultimately deals will continue to get done, Morgan Joseph's [Randy] Lampert said. "It is for the moment more difficult, but they will be done. It is just a matter of the pricing."