Is Stephen Schwarzman getting his mojo back?

A little more than week after another embarrassing setback—the collapse of a $1.8 deal for mortgage lender and vehicle fleet manager PHH because of financing problems—  Schwarzman has scored with a deal for a hedge fund.

His Blackstone Group is acquiring GSO Capital Partners for as much as $930 million in cash and units of Blackstone. With the deal, Blackstone is getting astar—Bennett Goodman, formerly of Credit Suisse First Boston—in leveraged finance at a time when obtaining credit has become very difficult.

"The combination  of GSO's businesses with our existing corporate debt operations will produce one of the largest credit  platforms in the alternative asset management business," Schwarzman said in a statement. "Given the current dislocation in the credit markets, this is an ideal time to create a more  powerful, diversified platform from which to grow Blackstone's business."

GSO, which has $10 billion in assets under management and offices in New York, London, Houston and Los Angeles, was founded by Goodman and other former First Boston executives, Tripp Smith and Doug Ostrover.

GSO specializes in corporate lending, particularly loans used to finance private-equity buyouts. What better way to deal with a credit crunch than to bring the financing operation in house?

GSO also take stakes in companies: It was part of the consortium that took Readers' Digest private. And it, too, has had troubled deals. It is in talks to salvage a $1.1 billion buyout of  Reddy Ice Holdings, the largest seller of packaged ice in the country.

GSO's Goodman has been in the forefront of modern corporate leverage, first on Drexel Burnham Lambert's junk bond desk and then at Donaldson Lufkin Jenrette.

Shares of Blackstone surged nearly 9 percent today.

Of course, Schwarzman has to make the "synergy" work. Today's pop in the stock price can also be attributed to the $500 million buyback Blackstone also announced today, which the New York Times' DealBook referred to as "a partial take-private of Blackstone by itself."

And the stock is is still 37 percent below its initial public offering price in June. Not yet time to wheel in the stone crabs.