The Lib Dems are preparing to form a centrist bloc with Conservative and Labour MPs "in the next six months," a senior Lib Dem source has told Business Insider.

With both the Conservatives and Labour deeply divided, the summer has been dominated with talk of MPs quitting the parties to form a new centrist movement.

The Lib Dems expect to be a "gathering point" for MPs who break away from the Tories and Labour, the source said, and are "putting ourselves in a position to be non-tribal and reach out when this happens."

Meanwhile, Sir Vince Cable will make a major speech on the future of the Lib Dems on Friday amid speculation that he is to resign in 2019.

LONDON — Moderate Conservative and Labour MPs have been in talks about splitting from their party whips "in the next six months" and forming a new centrist bloc in Parliament centred around the Liberal Democrats, a Lib Dem grandee has told Business Insider.

Lib Dem leader Sir Vince Cable has been "sounding out" potential defectors, with rumoured names including Labour MPs Chuka Umunna and Chris Leslie and anti-Brexit Conservative backbencher, Anna Soubry.

A senior Lib Dem this week told BI that they expect this process to take place "in the next six months or so" and said the party is currently "putting ourselves in a position to be non-tribal and reach out when this happens."

"It begins with a coalition of forces which finds expression in the House of Commons," they said. "Will it be a new political party? Probably not. But will the Liberal Democrats be a catalyst and a gathering point? Yes."

The source, who told BI they are actively involved in discussions with MPs from other parties, said they expected this process to take place in early 2019 and coincide with either another Brexit referendum or a general election.

"The most likely outcome is that we have a parliamentary stalemate, in that there's no majority for any sort of Brexit. Parliament will turn around to the people and ask them for help," they said.

"You have a referendum or a general election and in the case of the former, you'd have people arguing to remain in the EU standing together on platforms. But the latter, an election, would bring about that moment even faster.

"Neither the Tories or Labour can produce a manifesto on Europe without breaking themselves up. So in a general election, there would be a break up... Will the Lib Dems essential to that process when it happens? Absolutely."

With both the Conservatives and Labour struggling with internal warfare, particularly on the issue of Brexit, there is speculation that likeminded MPs from both parties will soon come together to create a new centrist movement.

Business Insider reported last month that this new movement would most likely take the shape of MPs from the Tories and Labour breaking away from their party whips to form a de facto grouping with the Liberal Democrats.

Cable will on Friday unveil reforms designed to modernise the Lib Dems and attract more supporters. These reforms are set to include allowing non-party members vote in leadership contests, and non-MPs stand to be leader.

BI exclusively reported last month that senior Lib Dems, including MPs, believed Cable would use his speech on Friday, September 7 to announce his plan to resign as leader sometime next year.