KUALA LUMPUR (Bloomberg) - Two of Malaysia's opposition parties plan to form a new alliance after the collapse of a former coalition in June following months of internal bickering.

Parti Keadilan Rakyat (PKR) and the Democratic Action Party (DAP) will hold discussions and negotiations on Tuesday (Sept 22) after the parties' leaders met on Monday (Sept 21), according to an e-mailed statement. There was no mention of Parti Islam seMalaysia (PAS), the third member of the former alliance.

The Pakatan Rakyat coalition imploded in June after struggling with disagreements including the planned implementation of shariah criminal law in a state controlled by PAS. Formed in 2008, the disparate alliance was largely held together by the goal of unseating the Barisan Nasional coalition that has been in power since independence in 1957.

PAS, whose conservative faction defeated moderates in party polls in June, cut ties with the mostly ethnic-Chinese DAP after its efforts to implement the Islamic penal code in Kelantan led the DAP to call it unconstitutional in secular Malaysia.

The jailing of PKR leader Anwar Ibrahim for sodomy had also led the alliance to fracture. He has denied the charges.

"I am confident the negotiations tomorrow will build a new political consensus that is stronger and in line with expectations of the people who dream of an opposition alliance that's strong and harmonious and able to beat Umno and Barisan Nasional," said PKR president Wan Azizah Wan Ismail.

Umno refers to Prime Minister Najib Razak's ruling party.

The disarray has helped Datuk Seri Najib, who has been under pressure for his handling of the economy and the performance of troubled state investment company 1Malaysia Development Bhd.

He has faced repeated public calls from former premier Mahathir Mohamad to step down, while the ringgit has been sliding towards levels last seen during the Asian financial crisis in the late 1990s.