The Dravida Munnettra Kazhagam on Tuesday blinked in the battle of attrition and conceded 63 seats for the Congress under a seat-sharing deal between the two parties for the coming Tamil Nadu assembly elections, ending three days of political drama.

The top leaders of the two parties have finally decided on the number of seats and the Congress will contest 63 seats, announced Congress leader Ghulam Nabi Azad to reporters outside the residence of party president Sonia Gandhi.

The demand of 63 seats by Congress marks an increase of 15 seats over the number of seats it got in the 2006 assembly elections. The DMK had announced its decision to pull out the party from the United Progressive Alliance government on Saturday over the Congress's demand.

The deal was announced after DMK minister Dayanidhi Maran held two rounds of talks with senior Congress leader Pranab Mukherjee in Parliament House, during which Azad and Gandhi's political secretary Ahmed Patel were also present.

After the meeting, Maran, accompanied by Union minister and DMK leader M K Alagiri, and Congress leaders drove to Gandhi's residence to thank her for the deal on behalf of the party's leadership.

The DMK had announced the pull-out of its six ministers from the Union Council of Ministers and offered issued-based support to the Congress-led UPA on Saturday, accusing its ally of making attempts to push it out of the coalition.

On Friday night, Karunanidhi had accused the Congress of being unreasonable by escalating the demand for seats from 50 to 60. And after the DMK agreed to settle for 60 seats, the party later raised the demand to 63 seats, he had complained.

But it was not clear whether there has been any agreement between the two parties on conceding to the Congress's demand for its choice of constituencies and power sharing formula after the elections. It was also not disclosed whether the Congress would get the extra three seats from DMK or from the quota of other allies like Muslim League and Pattali Makkal Katchi.

Congress and DMK leaders jointly announced the decision after meeting Gandhi at her residence in Delhi and informing Karunanidhi about the development.

Azad said the Congress and DMK have 'unanimously' come to a conclusion to contest 63 seats.

"This alliance will work together and campaign together and ensure that the alliance will come back to power," he said, claiming that it is a 'winning alliance'.

"We have other partners also like PMK, Viduthalai Chiruthaigal Katchi, Kongu party and All India Muslim League. All these parties will work together," said Azad, who was accompanied by Maran and Alagiri.

Asked about the formula of the deal with the Congress, Alagiri said, "It is a winning formula".

"This is the expectation of the cadre that there should be an amicable settlement," he said when asked whether the credit for clinching the deal should go to him and Maran.

"The DMK coalition has given 63 seats to the Congress. Sonia Gandhi has approved it," Alagiri said, adding that the DMK chief would decide how the Congress will be given three more seats.

He, however, declined to specify the details.

Asked whether DMK cadres will work for the Congress during the polls in view of the recent bitterness, Alagiri said, "Definitely. The entire cadre will work for the coalition and we will come back to power."

After the talks collapsed on Monday night during the meeting of DMK leaders with Gandhi, both sides renewed consultations on Tuesday morning through a series of meetings to thrash out the differences, with Mukherjee playing a key role.

Mukherjee had at least two telephonic talks with Karunanidhi since the crisis threatened the seven-year tie-up between the two parties.

The DMK-led alliance has a tough battle on hand as rival All India Anna Dravida Munnetra Kazhagam is also putting up a formidable alliance by roping in the Desiya Murpokku Dravida Kazhagam led by actor Vijaykant, the Marumalarchi Dravida Munnetra Kazhagam and the Left Front.