Israel protested to France after Orange’s Chief Executive, Stephane Richard, said earlier this month he would terminate the licensing arrangement with Partner “tomorrow morning” if the contracts allowed.
The source of the spat was the economic activities in Israeli settlements of the occupied Palestinian territories which France and the European Union consider illegal.
Richard later apologised to Israeli Prime Minister Benjamin Netanyahu and said his comments, made during a visit to Egypt, had been misinterpreted to suggest that he supported an outright boycott of Israel for political reasons.
Orange said the comments as reflecting a broader desire and strategy of not licensing its brand where it was not directly in control of the business.
Partner pays a fee to use Orange’s brand in Israel.
Under the new deal, if Partner does not exercise its right to terminate their brand agreement within 12 months, either Partner or Orange could terminate it during the following 12 months, Orange said in a statement.
If it all goes south then Orange will set itself up in Israel. Orange deputy CEO, Pierre Louette, said in the statement that Israel was a strategically important country and the company had a long-term commitment to it.
It had paid Partner $44.7 million to go away and it is estimated that an additional $50 million could be paid out should the agreement be terminated within 24 months.