Credit Suisse, a leading issuer of junk bonds and the parent of private equity affiliate DLJ Merchant Banking, now is ready for mop up duty, too. The Swiss bank is taking a 33 percent stake in Great American Group, a liquidation company. Great American clients have included K-Mart, Collins & Aikman and Arthur Andersen.

Is Credit Suisse trying to tell us something? Sure, buyout firms and investment banks have beefed up their restructuring groups in the last year, in preparation for a downturn in the frothy debt and credit markets.  These divisions, which focus on distressed assets and work-outs of troubled companies, appear to be nearing a jump in demand, as the credit markets continue to decline, defaults increase, and borrowing power dries up.

But few firms have taken the step of purchasing an actual liquidator, which typically sell off assets of companies in major trouble, or in other cases, in the process of going belly up. So does Credit Suisse think the post-LBO credit crunch be worse than the market thinks? Well, at the very least, it’s betting on an uptick in demand for liquidators.

Over the past decade, Great American says it has become a leader in conducting liquidations for wholesale and industrial companies. Credit Suisse said the investment bolsters its leveraged finance business.

(Image credit: Reuters file)