"This demonstrates that institutional holders will be acting more like very active, real owners," he said.

"A lot of institutional holders have indicated they will vote for the proposals."

He added that the proposals might persuade many more large pension funds and other institutional holders to ask questions.

The 7.8 million Abitibi shares are being sold to an unidentified institutional holder at a price of $10.25 each.

He said that a ratio of more than one would simply increase the advantage for institutional holders.

"Many institutional holders I speak to not only expect it, but think it's the right thing to do."

Seagram and 29 institutional holders control about 50 percent of the company's stock.

Traders said several large institutional holders were doing much of the selling, but that could not be confirmed.

Narragansett had already made available full data about those nonpublic companies to potential institutional holders of the new private company.

But institutional holders do not have perfect records, either.