When Blackstone Group LP, the world's biggest buyout firm, was pursuing the takeover of the Weather Channel cable network earlier this month with General Electric Co and Bain Capital LLC, Wall Street balked at providing financing.

<tr><td><p class='TableClas'></p><P class='TableClas'><DIV CLASS=rightDiv><script language="JavaScript">
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		<script type="text/javascript" src="http://pagead2.googlesyndication.com/pagead/show_ads.js">
		</script> </DIV><p class='TableClas'>So the New York-based company turned to GSO Capital Partners LP, the hedge-fund manager it acquired in March, to pull off the largest US leveraged buyout this year.
</p><p class='TableClas'>Blackstone can't wait for banks, stuck with almost $100 billion of debt from earlier LBOs, to start lending again. Instead, it's pushing deeper into deal financing with GSO. The strategy may hurt the hedge-fund unit's returns 

Blackstone risks hedge fund returns as LBO loans fade

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