Israel's Kadima and Labour parties are close to a deal on a coalition government led by Tzipi Livni, a move that sets her on course to form a new centrist administration, Army Radio said on Sunday.
Foreign Minister Livni still needs to persuade other parties to join her to build a workable parliamentary majority. She was named by President Shimon Peres to take over from Ehud Olmert, who quit as prime minister over a corruption inquiry.
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