July 10 (Bloomberg) -- Felipe Calderon is seeking alliances with opposition parties and pledging assistance to voters in states he lost in preparation to take over as Mexico's president in December even as his rival challenges the election results.

Calderon, 43, is in talks for possible cabinet posts with the Institutional Revolutionary Party as well as with a faction of the Party of the Democratic Revolution, whose candidate Andres Manuel Lopez Obrador placed second in the July 2 election tallies, said Cesar Nava, deputy secretary of Calderon's party.

The moves represent an effort by Calderon to contend with the reverberations of Mexico's closest-ever election and the protests that began over the weekend by Lopez Obrador supporters claiming fraud and demanding a vote-by-vote recount. In addition to trying to fulfill promises to spur growth and create jobs, Calderon must convince voters his victory is legitimate and answer the call of opponents for more spending to help the poor.

``He's going to have to extend an olive branch to the left,'' said Armand Peschard-Sverdru, director of the Mexico Project at the Center for Strategic and International Studies in Washington. ``It remains to be seen whether they will take it.''

Lopez Obrador, 52, on July 8 drew about 280,000 supporters to Mexico City's colonial center for a rally to demand authorities recount ballots after a second tally last week showed Calderon winning the election by 243,934 votes. Last night, Lopez Obrador, a former mayor of Mexico City and a champion of Mexico's poorest citizens, lodged his first legal challenge, filing allegations of fraud in a case that will go to the electoral court this week.

`Virtual Winner'

The court has until Aug. 31 to settle the case and until Sept. 6 to declare an official winner of the election, who takes office on Dec. 1. El Universal newspaper is referring to Calderon as the ``virtual winner'' because only the court has the authority to certify who is the nation's president-elect.

In the meantime, Calderon's team is speaking with the Institutional Revolutionary Party, whose candidate placed third in the election, as well as with the newly formed New Alliance Party and the Social Democratic Alternative Party and the ``modernization'' wing of Lopez Obrador's party about possible cabinet posts, Nava said in an interview yesterday in Mexico City.

Calderon's National Action Party overtook the Institutional Revolutionary Party as the biggest seat-holder in Congress in the election. The party now holds 52 of 128 Senate seats, 13 short of a majority, according to El Universal. In the 500-seat lower house, the party has 206 seats, or 45 seats short of majority, the paper said. Electoral authorities yesterday released percentages of the vote won by each party for Congress without specifying the number of seats.

Southern States

Calderon also said he will focus on the southern states that voted against him in the election, and offer to take up some of his opponents' causes, such as starting a relief program for corn, bean and sugar farmers. Fourteen of 16 central and southern states voted for Lopez Obrador, according to electoral authorities.

``I'm concerned there will be a crisis of legitimacy among the populace because of winning by such a slight margin and having a question mark by it,'' said Kevin Gallagher, a professor of international relations for Boston University.

Calderon, who pledges to stick with President Vicente Fox's economic policies, took 35.9 percent of the vote to Lopez Obrador's 35.3 percent, electoral authorities said after completing the recount of 40.9 million valid ballots last week. The recount only tallied individual ballots a second time when discrepancies were found; Lopez Obrador is demanding a full vote-by-vote recount.

Nullified Votes

Among his other claims, Lopez Obrador says electoral authorities nullified 900,000 votes that were improperly marked or defaced by people who wanted to protest that he says should be looked at again. He also cited mathematical errors in the more than 900 page filing presented last night. The filing also includes video tapes, which Lopez Obrador's party claims show evidence of ballot tampering in one state.

``It's very, very important that we clean up the electoral environment,'' said Francisco Hernandez Juarez, head of a labor umbrella group that represents about 4 million workers. ``Otherwise there will be a lot of political instability and it will be hard to run the country.''

Calderon, who has received congratulations from U.S. President George W. Bush, Canadian Prime Minister Stephen Harper and Spanish Prime Minister Jose Luis Rodriguez Zapatero, has wasted no time showing he's prepared to take over the presidency.

Unity

Since the election, Calderon's party has aired advertisements calling on the nation to unite. In one, a smiling Manuel Espino, president of the party, thanks Calderon supporters and voters who backed other candidates for exercising their democratic rights and urges them to unite around Calderon for the good of the country.

Calderon vowed at a July 7 press conference to be a president ``committed to the south,'' where Lopez Obrador was strongest.

Should the electoral court confirm his victory, Calderon's challenge will be to strike a balance between carrying out the pro-business policies he vowed to pursue and addressing the anti-poverty concerns of those who voted against him, Peschard- Sverdru said.

``Clearly the have-nots of Mexican society felt there needs have not been addressed, which is why they opted for Lopez Obrador,'' said Peschard-Sverdru. ``Felipe Calderon has six years to address those needs. Otherwise we're going to be right back where we started in 2012.''

To contact the reporter on this story: Thomas Black in Mexico City at tblack@bloomberg.net

Last Updated: July 10, 2006 10:41 EDT