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A tentative deal to create a single entity from the Canadian Alliance and the Progressive Conservative parties appears to be imminent.

Both Alliance Leader Stephen Harper and Tory Leader Peter MacKay cancelled their plans and headed back to Ottawa on Wednesday to speak in person.

Upon arrival in Ottawa after spending time in Halifax with his constituents, Mr. MacKay characterized the state of the merger talks as "very positive."

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"We've been very productive in the last few days."

"I believe now we're at a very critical point, a very close juncture in the discussions."

Mr. Harper was equally positive.

Before cancelling a constituency meeting in Calgary and boarding a plane to Ottawa for an urgent talk with Mr. MacKay, Mr. Harper told reporters he was optimistic there would be an "historic" deal to merge the parties after tonight's face-to-face meeting.

"We're pretty optimistic and we think we're going to have a conclusion pretty shortly," he said.

"I do think we're approaching something that is very historic in terms of not just this country, but in terms of practices around the world. It's not often that the political landscape is altered in a big way so quickly, but I think we're very close to doing that."

Mr. Harper wouldn't outline what issues would be hammered out in Wednesday night's meeting, but said the details would be released Thursday morning.

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"Everybody in these kinds of things has to make some concessions and trade offs, but it's not what you give up but what you're gaining here. And what we hope to do is fulfill the founding mission of our party -- to bring Reformers and Progressive Conservatives together," he said.

Mr. MacKay also said a merged party will be a positive move for the Tories.

"This is an evolution, not a devolution, of the Conservative Party. He went on to say that the decision to unite Canada's two right-wing parties is "greater than any party. It's an important and historic decision."

The two parties are under pressure to complete a merger soon so that they have time to prepare for an upcoming federal election, widely anticipated to be called next spring.

Mr. Harper clearly has his sights set on derailing Paul Martin's bid to become Prime Minister.

"There are some pretty big issues at stake here for the Canadian public and we're prepared to make whatever compromise is reasonable to ensure that Paul Martin takes a kicking in the next federal election," Mr. Harper said.

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"Paul Martin has been going around the country in this slow motion coup for the last year and half giving Canadians very little idea why he wants to be prime minister and really assuming that his election is somehow inevitable and I think this will represent a significant change in plans for him. He is going to have to start to justify his ascension to the office of Prime Minister, which he has not been doing,"

Mr. Harper scoffed at polls that suggest even a united right couldn't defeat the Liberals.

"We had a poll that elected Mario Dumont premier of Quebec. We had a poll that gave Bernard Lord every single seat in New Brunswick. I think we all know instinctively that if we were able to combine the forces of the Progressive Conservatives and the Canadian Alliance, that that will be a serious contender for power in the next election," he said.

Both leaders are expected to hold a news conference Thursday morning, when they will provide details of the tentative merger deal.

A Tory source told Canadian Press that Mr. MacKay told his caucus in a morning conference call that a tentative deal had been reached.

Lawyers were reportedly looking at the fine print of a proposed agreement.

The fact that lawyers have been called in to vet the agreement is of "high significance" and indicates a deal could be imminent, a Tory source said.

Mr. Harper has also scheduled a caucus meeting for Sunday, a few days earlier than the next regular caucus, scheduled for Oct. 22, CBC Newsworld reported.

"It's going to be an interesting day," Loyola Hearn, the Tory House leader and one of six emissaries who tried to negotiate a merger, said Wednesday. "I think our leaders are working hard to make sure this thing materializes.

A Tory source said the renewed optimism in the merger talks stemmed from the fact that Mr. Harper has moved closer to Mr. MacKay's way of thinking on how the leader of the new entity - which would be known as the Conservative Party - should be selected.

In a memo to his caucus issued last week, Mr. Harper said he is willing to accede to Mr. MacKay's request that each riding association have an equal say in how the leader is selected, putting aside his own view that ridings with more members be given greater weight in the vote.

In return for that concession, Mr. Harper wants Mr. MacKay to agree that the party's policies will be decided by a traditional Alliance method: a one-person, one-vote system that also requires the support of a majority of the party's provincial wings.

However, before any agreement is reached, both party executives and memberships at large will have to be canvassed before a joint leadership contest can take place. A party platform would then have to designed in time for a general election anticipated as early as next April.

Mr. MacKay said although it will be tight, he thinks there is time to get organized well ahead of a spring election.

However, he has more at stake, as not all Conservatives in the grassroots or caucus support merging with the Alliance.

"Clearly there is a ratification process that has to take place. It would require that the party membership has the final say," Mr. MacKay told reporters.

A date of Dec. 12 has been reportedly tossed about as a possible deadline for a mail-in vote on the merger by the members of both parties.

Mr. MacKay also made a deal with Tory leadership candidate David Orchard in June, that, in exchange for Mr. Orchard's support, he would not allow such a merger.

On Wednesday, Mr. MacKay did not answer a reporter who asked him how he could reconcile the imminent deal with the Alliance with the previous deal he had made with Mr. Orchard.

With reports from Canadian Press

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