Merkel ally Poettering elected head of EU assembly

STRASBOURG, France, Jan 16 (Reuters) A key ally of German Chancellor Angela Merkel, conservative Hans-Gert Poettering, was elected president of the increasingly influential European Parliament today.

The German conservative takes the mantle for the next two and a half years from Spanish socialist Josep Borrell under a rotating deal struck between the assembly's two largest groups at the beginning of the legislature's tenure in 2004.

Parliament has gained growing sway as co-legislator with the council of EU governments on a range of policies from internal market rules to the environment and transport.

Poettering defeated three rivals -- Green Italian MEP Monica Frassoni, Danish eurosceptic Jens-Peter Bonde and Francis Wurtz, a member of the European United Left group.

The Christian Democrat stood down last week after seven years as chairman of the centre-right European People's Party, the parliament's largest group and which includes the governing parties of France and Germany.

He was replaced by French politician Joseph Daul, a key supporter of French Interior Minister Nicolas Sarkozy.

REUTERS SP BS1658