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Israeli Prime Minister Benjamin Netanyahu is working to ink a long-awaited coalition deal that would see a new government sworn in just days before a visit by US President Barack Obama.
But a last-minute dispute over who would serve as Netanyahu's deputies threw a spanner in the works on Thursday, delaying an agreement which had been due to be signed earlier in the day, press reports said.
Netanyahu has been under huge pressure to present a line-up with a working majority of at least 61 MPs within the 120-seat Knesset (parliament) before a March 16 deadline.
After 40 days of intensive negotiations with potential partners, Netanyahu was expected to announce a deal between his Likud-Beitenu alliance, the centrist Yesh Atid and the far-right Jewish Home.
He has already signed an agreement with the small centrist HaTnuah party.
Party heads had been expected to ink the coalition contract at around midday on Thursday, but negotiators told public radio there had been a delay for last-minute fine-tuning.
In a posting on his Facebook page, Yesh Atid leader Yair Lapid said the signing of the deal looked imminent.
"There is a government," Noga Katz, spokeswoman for Netanyahu's rightwing Likud told AFP during the morning, saying details of the line-up would be released "in due course."
Netanyahu has said he expects the new government to be sworn in on Monday, just two days before Obama arrives for his first visit to the Jewish state since becoming president.
Obama said his forthcoming trip to Israel and the Palestinian territories will be to listen to both sides and hear their views on how to move forward after over two years without peace talks.
During the visit, starting March 20, Obama will meet with Netanyahu in Jerusalem and Palestinian president Mahmud Abbas and his premier Salam Fayyad in Ramallah to hear their perspective on how to resolve the decades-long conflict.
"I think we're past the point where we should be even talking about pre-conditions and steps and sequences. Everybody knows what's going to be involved here in setting up two states, side by side, living in peace and security," he said in an exclusive interview with Israel's Channel 2 television.
Media reports said Netanyahu had pieced together a coalition with a majority of 68 comprising Likud-Beitenu (31), Yesh Atid (19), Naftali Bennett's Jewish Home (12) and the centrist HaTnuah (6).
Under the agreement, Netanyahu would preside over a slimline cabinet of 21 ministers, compared with 28 in the previous government.
The 11th-hour deal was widely seen as a victory for political newcomer Lapid, who wrested the influential education portfolio for his party's number two and who will himself become finance minister.
Although Likud-Beitenu wil have a majority in cabinet, Netanyahu's authority will be less than it was in the outgoing government, which included the more malleable ultra-Orthodox parties, who are absent from the new line-up for the the first time since 1984.
"The clash of the Titans over the education portfolio ended with a victory for Lapid," wrote Haaretz's political commentator Yossi Verter.
"It was yet another victory, after he had forced Netanyahu to part from his ultra-Orthodox partners and imposed a painful reduction in the number of government ministers."
But Netanyahu played up the importance of Likud's retained portfolios, including defence and foreign affairs.
During the negotiations, Lapid pushed for a coalition without the ultra-Orthodox, a reduction in the cabinet size and for his party to take the prestigious education portfolio -- all of which he got.
Commentators said the new government would have a clear rightward leaning, with hardliners set to assume responsibility for several key ministries relating to the Jewish settlements on Palestinian land.
Jewish Home's number two, Uri Ariel, is an ultra-nationalist settler slated to take over the housing ministry which plays a central role in settlement construction.
The party, which adamantly opposes a Palestinian state, is also likely to control the parliamentary finance committee which plays a key role in funding the settlements.