Hectic parleys were held between the former Akali leader and Punjab Congress chief Amarinder Singh and other senior party leaders before the decision was taken to merge Badal's outfit, People's Party of Punjab, with Congress, sources said.
The merger was sealed on Friday during a meeting between Badal and Rahul at the latter's residence here where Singh and All India Congress Committee General Secretary Shakeel Ahmad were also present, they said.
A formal announcement in this regard is likely to be made soon, they added.
Manpreet had unsuccessfully contested the 2014 General Elections from Bathinda on a Congress ticket against his sister-in-law and Akali leader Harsimrat Kaur Badal.
He was earlier part of the ruling Shiromani Akali Dal government and held the finance portfolio until his exit from the party over differences with his uncle Parkash Singh Badal and cousin Sukhbir Singh Badal.
He had thereafter launched the People's Party of Punjab.