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U.S. praises Georgia's Saakashvili for conceding

WASHINGTON (Reuters) - The United States praised Georgian President Mikheil Saakashvili on Tuesday for conceding his party lost parliamentary elections and asking the victorious coalition to form a government.

State Department spokeswoman Victoria Nuland said she thought that Saakashvili's concession may bode well for cooperation between the new government and the president, who is due to step down next year.

"There had been a lot of charges back and forth, a lot of hot rhetoric but ... the signal that President Saakashvili sent by a) conceding and b) saying he would ask them to form a government and that they would work together -- president and new government -- sends a very good signal," Nuland added.

Saakashvili conceded to the Georgian Dream opposition coalition, led by billionaire tycoon Bidzina Ivanishvili, who has promised to ease tensions with Moscow, four years after Georgia, a staunch U.S. ally, lost a war with Russia.

Saakashvili's acceptance that his United National Movement party will go into opposition increased the chances of Georgia's first peaceful transfer of power between rival parties since the Soviet Union collapsed in 1991. However, it may yield an uneasy cohabitation between Ivanishvili, who is likely to become prime minister, and Saakashvili before his scheduled departure next year.

Instability in the Caucasus country would worry the West because it is a conduit for Caspian Sea energy supplies to Europe and has a strategic location on the Black Sea between former Soviet master Russia and Iran, Turkey and central Asia.

(Reporting By Arshad Mohammed; Editing by Sandra Maler and Stacey Joyce)