According to a statement issued by the Prime Minister's Office, "the two men expressed their confidence in Ashkenazi's ability to successfully fulfill the post and implement the lessons of the Lebanese War."
Olmert and Peretz also "praised the other candidates for the position - Deputy Chief of Staff Major General Moshe Kaplinsky and GOC Ground Forces Major General Benny Gantz - and noted that they were both worthy candidates," the statement continued.
According to the statement, Peretz will submit Ashkenazi's candidacy to the Government's Advisory Committee on Senior Appointments chaired by retired Supreme Court Judge Yaacov Terkel, before submitting it to the full Cabinet for a decision.
The High Court of Justice instructed Olmert and Peretz on Monday to justify within four days their decision to appoint a new IDF chief prior to the Winograd Committee's interim report on the second Lebanon war.
Nonetheless, Justice Ayala Procaccia said that at this time there is no reason to prevent the appointment.
The court's decision came in response to a petition by the Movement for Quality Government, which argued the incoming IDF chief could soon find himself being held partly responsible for the army's failures during the war.
In addition, the petition argued that it is inappropriate for Olmert and Peretz to appoint the next IDF chief, because they too could be blamed for the failures.
Olmert and Peretz on Monday asked Kaplinsky to stay on as deputy chief of staff following the anticipated appointment of Ashkenazi.
Associates of the prime minister have said that the majority of officials with whom Olmert has consulted recommended that Ashkenazi be appointed.
It is still unclear whether Kaplinsky would stay on as deputy chief of staff.
Those close to Kaplinsky said last week that he intended to retire if he was not made IDF chief. In his letter to Peretz, however, Kaplinsky offered his experience and capabilities for as long as they were needed.
Kaplinsky, one of the three candidates for the post of chief of staff, announced in Sunday's letter to Peretz that he had decided to pull out from the race.
Kaplinsky cited his wish to put an end to the "media circus" surrounding the matter of the appointment.
Peretz arrived at the decision following a series of consultations he held on Sunday, and the appointment is expected to be finalized in two weeks.
Late last week, Kaplinsky had concluded that his chances of receiving the appointment were few.
"I believe that I have the experience, the capability and the [moral] authority to carry out the function of the chief of staff in the best way possible... however, the IDF is a people's army... and therefore it is my view that the appointment of chief of staff must enjoy the widest possible consensus," he wrote.
"Since you decided, according to media reports, to appoint a chief of staff in the coming days and not wait for the full examination of the facts relevant to the war, I feel that it would be inappropriate for me to take on the role, at this time, and therefore request to withdraw my candidacy," Kaplinsky added.
Peretz began considering the appointment of Ashkenazi as the next chief of staff soon after the end of the war in Lebanon, last August. Last week, following the announcement of Dan Halutz that he had decided to resign from the post, Peretz began promoting the idea of Ashkenazi as his replacement.
Last update - 00:09 23/01/2007
A short biography of Major General Gabi Ashkenazi
Major General Gabi Ashkenazi will return to the IDF as its Chief of Staff, two years after retiring when he lost a previous contest for the job to Dan Halutz.
Ashkenazi was born in Moshav Hagor to a father who is a Holocaust survivor and a Syrian-born mother. He joined the Golani Brigade in 1972 and served as a soldier in the Yom Kippur War. In 1976 brigade commander Uri Saguy added him to the Golani force that participated in the Entebbe operation, but Ashkenazi did not take part in the battle at the airport.
In 1978 Ashkenazi served as deputy battalion commander in Golani, was wounded in the Litani Operation and left the army. Two years later he was asked to return and was appointed battalion commander. In the war in Lebanon he served as deputy brigade commander and in 1986 was appointed Golani commander. In 1990 Ashkenazi was appointed commander of a reserves division and in 1992 as commander of the Lebanon Liaison Unit.
In 1994 he was appointed head of operations in the General Staff and in 1996 he was promoted to major general and appointed aide to the Operations Division. In 1998 he was appointed GOC Northern Command, in which he was responsible for pulling IDF forces out of Lebanon, a move Ashkenazi criticized for not being carried out in agreement with Syria.
The report examining the abduction of the soldiers in October 2000 in Har Dov cleared Ashkenazi of blame and in 2002 he was appointed deputy chief of staff. During the intifada he was seen as the most moderate member of the General Staff. He objected to aggressive acts against the Palestinians and as director of the separation fence project he tried to persuade the authorities to build the wall as close as possible to the Green Line and not infringe/encroach on the Palestinians' life.
In an interview for the book "The Seventh War," Ashkenazi told writers Amos Harel and Avi Issacharoff that the moral damage done to IDF soldiers due to the fighting in the territories worried and alarmed him. "My greatest fear is the loss of humanity because of the ongoing warfare," he said.
It is possible that his opinions made prime minister Ariel Sharon and Defense Minister Shaul Mofaz choose his rival Halutz as chief of staff instead of him. Shortly after the announcement of Halutz's appointment Ashkenazi said he was leaving the army.
After that his name was mentioned several times in connection with senior positions. Last July Defense Minister Amir Peretz appointed him director general of the Defense Ministry.
"Gabi Ashkenazi will bring basic values back to the IDF. He's a jolly good soldier, who worked his way up," said Major General (Res.) Uri Saguy, Ashkenazi's former commander, yesterday. Ashkenazi has a BA in political science and is a graduate of the Kennedy School of Government. He is married and father of two children.