Mariano Rajoy's party signs Ciudadanos deal in bid to head off third election

Spain's conservative Popular Party has signed a deal with the business-friendly Ciudadanos party that could pave the way for the formation of a new government and avert a possible third round of elections.

The parties signed a package of conditions set by Ciudadanos a day after parliament announced that Popular Party leader and acting premier Mariano Rajoy will put his candidacy to form a new government to a first vote on August 31.