For Rent, Gorgeous Offices in Ramat Gan

A laconic advertisement published in one of the daily papers this week tells the whole story. Not in so many words, perhaps, but it is marks the end of one of the great dramas in Tel Aviv capital market circles.

The ad simply offers office space for rent by the Ramat Gan diamond exchange. It does note that the offices are exquisitely finished, and occupy 1,200 square meters on each of three stories plus 900 square meters on a fourth story. The space will be available for occupancy from May this year, the ad adds.

What the ad doesn't mention is that the offices are being vacated by Prisma, the ill-fated investments arm of the private equity fund Markstone.

Prisma leased the offices in late 2007 and invested NIS 7 million in them during its short stint.

Just over a year has passed since it took possession, and just 2.5 years have passed since the investment firm was founded by Ron Lubash and Amir Kess.

It began with fanfare, but in the last month, Prisma reached the end of its road. It has sold its mutual funds to Excellence and its provident funds to Psagot.

From October 2008, Prisma has fired 100 people, and now has 250 left. Of these, only 80 will be joining Psagot and Excellence, leaving the rest to find new employment.

The heavy liabilities that Markstone undertook when founding the investment firm have forced the management to sell Prisma's assets as part of its liquidation.

The firm began stumbling due to the steep losses by the provident and mutual funds that it bought from the banks, when the latter were forced to get out of investment management by a Finance Ministry reform.