Plans for an early election in Israel have been called off and a unity government has been formed instead.
The opposition, centrist, Kadima party is joining up with Prime Minister Benjamin Netanyahu’s Likud party.
The surprise move could give Netanyahu a freer hand to confront Iran over its nuclear ambitions.
The news has come as a shock to people in Jerusalem.
“They’re supposed to set an example for the citizens,” said one resident.
“They’re selling themselves for a seat and all to be in government. I’m very surprised, but if Bibi (referring to Netanyahu) made such a move and was able to convince them, congratulations.”
The agreement – due to be signed today – will create a majority of 94 legislators, one of the biggest in Israeli history.
According to analysts, the pact will strengthen Israel’s global position.
“It is going to be able to tackle the major problems, threats and challenges that Israel faces both domestically and in the region, particularly vis a vis Iran,” said Gerald Steinberg, a strategist at Bar Ilan University in Jerusalem.
“It sends a very strong signal to Tehran but also to Europe and the United States that if Israel is united, the leadership is capable of dealing with the threats that are there, if and when it becomes necessary,” he continued.
Officials say the recently elected head of Kadima Shaul Mofaz will become Deputy Prime Minister. He has previously hinted at the possibility of an attack on Iran.