Two scenarios i can think of here
1) Mosaad sold pre-made pagers with bombs inside them. They worked as intended but had planted explosives in them. Israel tracked the phones and once enough were initiated and being used the then attacked.
2) They sent a virus to the phones causing their batteries to overheat and explode. The implications of this are very scary. This means technology exists to blow up phones in airplanes etc. We all carry them with us all the time. And if they can do it to a pager they can do it to a cell phone.
I've seen both ways discussed so not sure which one it was or possibly even another method?