Boutique consultancy Lucid was founded by Caroline Wagstaff and Ruth Starling in 2005.
The pair built the agency following high profile in-house careers; Wagstaff is a former director of comms of Lloyd's of London, while Starling was comms head for Arthur Andersen.
The deal will see the duo become directors and shareholders in the newly enlarged Luther Pendragon business.
Lucid's client list includes Deutsche Bank, Nomura, Grant Thornton and some of the leading players on the Lloyd's of London insurance market.
Simon Whale, MD at Luther Pendragon, explained the acquisition reflected the increased need for financial and professional services firms to defend their reputations and promote their services.
'Lucid has that expertise in depth and will add great weight to our credentials in this area,' he said. 'It represents another vital step in fulfilling our objective of offering clients across a wide range of sectors a complete corporate comms service. This is underpinned by the passionate attention to detail and highest quality client care that both Luther and Lucid are built upon.'
Wagstaff added the transaction would enable Lucid to sustain growth by tapping the resources of the wider agency.
'We chose Luther because it has the same commitment to unrelenting high-quality client services, senior hands-on consultancy, and great strategic advice coupled with a terrier-like determination to deliver,' she said.
Wagstaff also headed corporate comms at College Hill in 2003, while Starling is a former health journalist.
Luther Pendragon has grown into one of the largest independent agencies in the UK, having been launched by ex-journalists George Pitcher and Charles Stewart-Smith in 1992 before an MBO in 2005.