Fedeli, the PC finance critic and former North Bay mayor, surprised supporters when he pulled out and threw his support behind Elliott, the widow of former finance minister Jim Flaherty.
Fedeli said he hadn't sold enough PC memberships or raised enough money to win the leadership, even though he was second to Elliott in donations posted with Elections Ontario, raising $156,000 so far compared with her $515,000.
"I'm a numbers guy, and I'm a pragmatist," he told a small crowd of supporters at Elliott's Toronto campaign headquarters. "I've added up the numbers, and simply put, I don't see them being there for me to win this leadership race."
Fedeli vowed to run for re-election in 2018, and said he quit now in part so he wouldn't have to pay a $25,000 deposit each leadership candidate has to post.
"The timing, if you want to know the absolute specifics, Friday is the final date — pay up or get out," he said.
Elliott said she and Fedeli believe "fiscal responsibility and social compassion must go hand in hand," but rejected suggestions the race is splitting Tories along right and left lines.
"It's no longer a time for red Tory, blue Tory, social conservative (or) whatever," she said.
A spokeswoman for MacLeod said the Nepean-Carleton MPP was considering whether to pull out of the race to run federally in the Ottawa-West Nepean seat soon to be vacated by former foreign affairs minister John Baird.
"Vic's announcement has changed the dynamic of the race, and we are evaluating our strategy going forward," said spokeswoman Jessica Georgakopoulos.
MacLeod has raised about $105,000 so far, said Georgakopoulos, while London-area MPP Monte McNaughton has posted just under $20,000 in donations with Elections Ontario.
McNaughton and Patrick Brown, a Barrie MP, are considered on the right wing of the party, with both leadership candidates speaking out against proposed changes to Ontario's sex education curriculum.
Elliott, the MPP for Whitby-Oshawa, said Brown had a different view of the party than her, but insisted she too has concerns with the changes being contemplated in sex education and wants parents to have a say in any update.
"I don't think we need to be afraid (but) I am very concerned that the Liberals are not being forthcoming with what the sex ed curriculum has to say," she said.
Brown, the only one of the four remaining leadership contenders not to have a seat in the Ontario legislature, has posted $105,000 in donations so far.
Fedeli is well known and respected in northern Ontario, but many northerners "still feel excluded" from the PC party," Brown said in a release.
"They want a party that consults with and listens to its members, not a party whose leaders arbitrarily proposed to cut 100,000 jobs," Brown added.
Many Tories believe former PC leader Tim Hudak's pledge to eliminate 100,000 public sector jobs cost them the 2014 election.
Hudak resigned shortly after the Conservatives' fourth consecutive election defeat last June, when the Liberals were returned with a majority government.
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