FORMER ITALIAN premier Silvio Berlusconi says he has re-established his historic alliance with the anti-immigration Northern League party in a move which could make next month’s elections significantly closer.

“An agreement has been signed,” Berlusconi told RTL television, after weeks of uncertainty over whether his People of Freedom (PDL) party could heal a rift with the League to run together in key battleground regions in the north of the country.

The billionaire media magnate said the post of prime minister “will be decided if we win” but could go to the PDL secretary Angelino Alfano.

“Alfano could be our candidate for prime minister and I could be the finance minister,” he said.

Talks between the two parties in recent weeks have appeared to hinge on Northern League head Roberto Maroni’s demands that party-loving Berlusconi withdraw his candidacy for premier.

“I am the leader of the coalition and I will decide with the other parties involved, in the case of a victory, who will be the candidacy for prime minister,” Berlusconi said.

The PDL, which has been hit hard by internal divisions, has been dragging in the polls behind the centre-left, which has so far been tipped to win the February 24-25 election.

Italy’s complex electoral system could see the left, lead by cigar-chomping Communist Luigi Bersani, win a strong majority in the lower house but lose out to the PDL and League in the Senate, should the vote in the north be split.

The country’s biggest region, Lombardy, is the traditional stronghold of the League, but the party has been weakened by a corruption scandal and was unlikely to turn down a deal with the PDL.

The PDL and eurosceptic League were allies until Berlusconi’s downfall in 2011, when the three-time premier was ousted during a financial crisis which saw prime minister Mario Monti take over the reigns at the head of a technocrat government.

The League refused from the start to back Monti’s government, while the PDL initially lent its support, before pulling the plug last month and kicking off the electoral campaign.