Kadima grew out of both Likud and Labor. When he decided it was time for a strategic retreat from Gaza, Ariel Sharon left Likud and took with him many other Likudniks. They joined up with many Labour politicians. Kadima became the biggest party, and Likud and Labor struggled.
Now - after Sharon's disabling illness, and Olmert's inept and corrupt term in office - Likud has become the biggest party - but not big enough to lead without a coalition.
Likud tried to get Kadima to agree to join a national unity government, but Livni refused to become a second in command to Netanyahu. So Bibi made deals with other right of center parties - AND WITH BARAK AND LABOUR!
This means Bibi of Ol' Likud will have a majority which depends on a coalition with Barak and Ol' Labour - AND THEIR MAIN OPPOSITION WILL BE KADIMA - WHICH IS MADE UP OF FORMER LIKUD AND FORMER LABOUR!?
IOW: it's Labour & Likud versus Labour & Likud.
This is weird. And dysfunctional.
Israel needs to junk their parliamentary and proportional Knesset for a bicameral district-based and non-proportional representative democracy based on the US Congress. This will give their administrations more stability.