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There were reports that the armed hostage taker was dead, but CNN could not immediately confirm that. Several people were seen walking off the bus following the 10-hour standoff.

Dozens of heavily armed policemen had earlier converged on the parked tour bus.

Police boarded the gunman-controlled bus about 40 minutes after the driver exited and said the hostage-taker had killed all those remaining on board, CNN's Anna Coren reported. The police retreated immediately, possibly after firing a shot into the bus, pictures from the scene showed.

Earlier, a police assault team charged the bus, breaking the windows with an axe, Coren said.

The gunman, a former police officer, sprayed machine gun fire at the hostages, a police spokesman told CNN. It was not clear whether anyone was killed.

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