According to reports this morning, the new firm will be called Global Counsel LLP. It is expected to be chaired by Mandelson and run by his long-standing ally Ben Wegg-Prosser.
It is understood that Global Counsel will initially advise foreign companies, due to Cabinet Office restrictions, although this could change in time.
WPP insiders told PRWeek that Mandelson had been working out of the firm’s Knightsbridge-based JWT advertising agency in recent weeks, carrying out a ‘top secret project’.
It was also suggested that Gordon Brown’s former director of political strategy David Muir had been asked to play a role in the new set-up.
Former WPP stalwart Muir is highly regarded by Sorrell, having served as one of his right hand men before joining Downing Street in 2008. He could not be reached for comment.
PR agencies owned by WPP include Burson-Marsteller and the City firm Finsbury, run by Roland Rudd, who is known for his close ties to Mandelson.
According to documents filed at Companies House, Global Counsel was incorporated last week.
WPP chairman Martin Sorrell declined to comment. The story was broken this morning by Sky News.