* Apparent olive branch after talks with Israel collapse
* Israel suspended talks after Abbas unity pact with Hamas
* Netanyahu rejects overture from Palestinian leader (Adds Netanyahu comments in U.S. TV interviews)
By Jeffrey Heller
JERUSALEM, April 27 (Reuters) - Palestinian President Mahmoud Abbas called the Nazi Holocaust "the most heinous crime" against humanity in modern times, in an apparent bid to build bridges with Israel days after troubled peace talks collapsed.
Prime Minister Benjamin Netanyahu rejected the overture on Sunday, saying Abbas's Palestinian power-sharing deal with Hamas, which led Israel to suspend the negotiations on Thursday, put him in partnership with an Islamist group that denies the Holocaust and seeks the Jewish state's destruction.
"What I say to him very simply is this: President Abbas, tear up your pact with Hamas," Netanyahu said on the CBS news programme Face the Nation.
Abbas's message, published in Arabic and English by the official Palestinian news agency WAFA, coincided with Israel's annual remembrance day for the 6 million Jews killed in the Holocaust, and included an expression of sympathy for the families of the victims.
"What happened to the Jews in the Holocaust is the most heinous crime to have occurred against humanity in the modern era," WAFA quoted Abbas as saying at a meeting a week ago with an American rabbi.
By speaking in superlative terms, Abbas could risk a backlash from Palestinians who draw comparisons between their suffering at the hands of Israeli occupiers and that of Jews under Hitler's Third Reich.
Abbas has condemned the mass killings of Jews in World War Two before and challenged allegations, stemming from a 1983 book he authored, that he is a Holocaust denier.
But the timing of the publication of his latest comments gave them extra significance, a day after he signalled he remained committed to the peace talks and said a future Palestinian unity government would recognise Israel.
On CBS, Netanyahu said he and U.S. Secretary of State John Kerry "were both shocked" to learn last Wednesday of the reconciliation agreement between Hamas and Abbas's Palestine Liberation Organization.
The peace negotiations, championed by Kerry, were facing an April 29 deadline, with little public sign the two sides were making progress toward a U.S.-mediated deal to extend the talks.
Netanyahu said in the TV interview, however, that he had negotiated in earnest for nine months, working closely with Kerry, and "we made some significant progress".
Palestinian officials have blamed Netanyahu for the peace impasse, noting he failed to carry out a pledged release of Palestinian prisoners and citing Israeli announcements of further construction in settlements in the occupied West Bank.
Netanyahu has said Abbas's refusal to recognise Israel as a Jewish state blocked progress in talks aimed at ending decades of conflict and creating a Palestinian state.
The Palestinian unity accord followed seven years of failed reconciliation attempts after Hamas seized the Gaza Strip from forces loyal to Abbas in 2007.
The agreement envisages the formation of a Palestinian government of non-political "technocrats" within five months and new elections six months later.
On CBS, Netanyahu said Abbas "cannot embrace Hamas and say that he wants peace with Israel". In a separate interview with CNN, Netanyahu reiterated he would never negotiate with a Palestinian government backed by Hamas, a group that both Israel and the United States regard as a terrorist organisation.
Hamas officials were not immediately available to comment on Netanyahu's Holocaust-denial accusations.
But in an open letter to a senior U.N. official in 2009, Hamas branded the Holocaust "a lie invented by the Zionists". Hamas was protesting U.N. plans at the time to start Holocaust studies for children in Gaza.
Yad Vashem, Israel's national Holocaust memorial, gave a guarded welcome to Abbas's statement on Sunday.
"Holocaust denial and revisionism are sadly prevalent in the Arab world, including among Palestinians," Yad Vashem said. "Thus the statement, that the Holocaust is the most heinous crime to have occurred against humanity in the modern era, coming from Abbas, might signal a change." (Additional reporting by Jim Loney in Washington; editing by Andrew Roche)