The general who helped install him (general Zahedi) had also been in prison for collaborating with Nazis, until he was freed specifically to lead the coup.
How exactly does someone go from being a Nazi to being so friendly with Jews?
You seem to be confusing Reza Shah Pahlavi, the Shah of Iran between 1925 and 1941 with his son, Mohammad Reza Shah Pahlavi. The former was definitely warm with Nazi Germany and it was a belief that Reza Shah was about to enter an alliance or in other way let Iran be accessible and used by the Axis powers that led to the Anglo-Soviet invasion of Iran in 1941 in which the Shah's son, Mohammad Reza Shah, took power and would remain until 1979. Considering that the state of Israel was founded in 1948 and that Reza Shah had been out of the picture for 7 years by that time, the Israel did not come to have a close relationship with a Nazi co-operating Shah of Iran - but rather with his son who was essentially installed by the Allies.