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Jenson Button will move to McLaren-Mercedes next season to join compatriot and fellow world champion Lewis Hamilton, the team has confirmed.

The announcement of a multi-year deal between Button and McLaren follows weeks of feverish speculation about the champion's future, which was heightened when he paid a visit to the McLaren factory last Friday.

Although Button was initially expected to remain with the Brawn team that took him to the 2009 title, talks with Ross Brawn's squad reached an impasse over the issue of Button's salary. The Briton had taken a pay cut to help the team when Honda's exit left it in a delicate financial position, but now sought a wage increase having clinched the championship - and given that Brawn's finances would become more healthy following its takeover by Mercedes-Benz.

"It's always a difficult decision to leave a team when you've been there for so long," said Button. "But life is all about challenges - and, most important of all, it's about challenging yourself.

"So, although I won the world championship with Brawn GP last year, and I'll never forget that, I was always adamant that I wanted to continue to set myself fresh challenges. So that's why I've decided to join Vodafone McLaren Mercedes.

"You can't help but be affected by this team's phenomenal history. McLaren is one of the greats of world sport, and its achievements and list of past champions read like a Who's Who of Formula 1 - Emerson Fittipaldi, James Hunt, Niki Lauda, Alain Prost, Ayrton Senna, Mika Hakkinen and of course my new team-mate Lewis Hamilton. I've followed the McLaren team ever since I was a small boy, and it feels unbelievable to finally be a part of it."

McLaren had originally lined up Kimi Raikkonen to fill its second seat, but these talks also broke down during pay discussions, leading to Raikkonen's decision to take a year off from Formula 1 next year, and leaving the way clear for Button to take the vacant McLaren drive as he was unable to agree a suitable deal with Brawn and Mercedes.

Button's move ends a seven year relationship with his previous team, which he joined when it was still known as BAR in 2003, and stayed with through its difficult seasons under Honda ownership prior to this year's fairytale success.

He said he had been deeply impressed by McLaren since beginning talks with the squad.

"When I visited the McLaren Technology Centre earlier this month, it wasn't simply the technical resources and the incredible standards of excellence that impressed me," Button said. "No, I was equally struck by the ambition, the motivation and the winning spirit that flow through everybody there. And then there's the team's epic history: put it this way, the trophy cabinets seem to stretch for miles.

"From a personal point of view, it's also a great pleasure to be joining a fellow British world champion. Lewis has achieved an incredible level of success in a very short period of time, and he's a wonderfully gifted driver who has earned the respect of every Formula 1 driver. I'm sure there's plenty that we can learn from each other, and I'm really looking forward to using our combined knowledge to push the team forward."

With Button no longer in the frame, Nico Rosberg is expected to be announced as Mercedes' lead driver for its new works F1 assault with the erstwhile Brawn team, with Nick Heidfeld linked to the second seat.

Button replaces Heikki Kovalainen at McLaren. The Finn took only one win during his two seasons as Hamilton's team-mate, and struggled for race pace this season despite some strong qualifying performances.

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