Stephen Levey, Jonathan Half leaving UBS to work for Frank Lowy

Stephen Levey, the UBS Warburg investment banking manager in Tel Aviv, and Jonathan Half, the bank's chief analyst in Israel, are leaving the bank and launching a new investment fund, TheMarker has learned.

It's not an ordinary investment fund, though, it's a one-man vehicle for the Jewish Australian billionaire Frank P. Lowy. The fund will be established through his corporation, LFG Holdings.

The new fund will invest in public companies traded in Tel Aviv and elsewhere. Its main office will be abroad, but it will maintain a local office.

Lowy, one of the world's biggest real estate entrepreneurs, has looked at Israel before. He has even considered buying controlling interests in IDBH), the First International Bank of Israel (TASE: FIBI), and Bank Leumi (TASE: LUMI), but none of those plans came to fruition. Meanwhile he has bought an apartment in Tel Aviv, where he stays after sailing to Israel on his giant yacht, which can sometimes be seen docking in Herzliya.

Among Lowy's assets is Westfield.

Until two years ago Stephen Levey had been UBS' senior analyst in Israel, after which he became one of the leading investment bankers. Jonathan Half is held in high esteem for his analyses of Israeli companies. Now the two are taking advantage of the growing interest of foreign investors in Israel, and their reputation, to establish the fund for Lowy.

Capital market sources believe that a lot of major talent will be abandoning equity research in the year to come, setting up investment and hedge funds to satisfy the investment community's hunger for alternative vehicles that outperform the market.