The venture will incorporate the group's 70-strong PR agency Mandate Communications and financial PR specialist Hogarth, along with the group's design agency Totem and brand consultancy Dave.
A new headquarters is already being sought for the business, which will have 140 staff in total. Mandate Communications CEO Sacha Deshmukh will become CEO of the consultancy, while Hogarth founding partner Chris Matthews becomes chairman.
Announcing the new venture, Deshmukh took a swipe at rival agencies, claiming: 'For too long the corporate communications market has been sclerotic. The dinosaurs have failed to grasp the changing nature of corporate reputation and the growth of new media channels ... They are stuck giving clients a hot metal service that doesn't deliver in a fibre optic world.'
Deshmukh also outlined ambitious growth aims: 'We expect to have more than 200 people by the end of 2010.'
Engine Group joint chief executive Peter Scott added: 'Within 24 months we plan for Engine Business to be firmly in the corporate communications top ten by size, and at the very top by reputation.'
Scott added that while all Engine's PR agencies would in future operate under the Engine Business brand, they would keep their old identities.
Separately, Mandate has landed a six-figure account with gas body Corgi and a public affairs brief with Whitbread. As revealed on prweek.com (9 July), Mandate has been briefed by Whitbread to promote the use of its Premier Inn hotel chain by civil servants and MPs as their expenses come under scrutiny.