four from Economic Synergy: Jeffrey Lam Kin-fung, Sophie Leung Lau Yau-fun, Lau Wong-fat and Andrew Leung Kwan-yuen;

four from Professional Forum: Dr Raymond Ho Chung-tai, Abraham Razack, Professor Patrick Lau Sau-shing and Dr Priscilla Leung Mei-fun;

and independent lawmaker Philip Wong Yu-hong.

Lam will act as convenor, with Miriam Lau and Ho as deputies.

Lam said: 'We believe most Hong Kong people want a stable society rather than growing populism and radical movements that make society more divided.'

He cited the by-elections triggered by the resignation of five pan-democratic lawmakers in March last year as one motivating factor behind the new group.

Lam said the alliance would not bind its members when they cast votes in the legislature, and the existing political groupings represented by respective members would not combine in the near future.

The Legislative Council now has three major factions: the pan-democrats with 23 votes; the pro-establishment camp - which includes the DAB and the Federation of Trade Unions - with 14 votes; and the new pro-business alliance with 12 votes.

Lam said the alliance came together because the members found common ground on social and economic issues. They began discussions on forming a coalition several months ago as they saw society had become more divided and the political atmosphere more radical.

Andrew Leung said members would not rule out the possibility of developing further as an organised political party in future. Miriam Lau, who is chairwoman of the Liberal Party, said: 'We were seen as divided groups in the past and therefore our bargaining power was weak.'

She would vote according to her party in the event of a voting preference that conflicted with the alliance.

'My loyalty rests with the Liberal Party.' But she said the alliance would give the party a platform to take a united stance on policies and to strengthen its bargaining power in negotiations with the government.

The power reshuffle comes after three former Liberal Party lawmakers - Lam, Sophie Leung and Andrew Leung - walked out three years ago amid an intense leadership power struggle. They then set up the pro-business group Economic Synergy.

The political restructuring also comes ahead of the District Council elections in November, in which Lam said the alliance would field 'no less than 50 candidates'.

He also said it would co-operate in the elections for the Election Committee that selects the chief executive in January and for Legco in September next year.

'When someone declares their candidacy for the chief executive election, we will give our voice as well,' Lam said.

James Sung Lap-kung, a City University political scientist, said it would now be easier for the government to canvass support from pro-establishment camp as it only needed to negotiate with a few groups.

He said the new alliance had a hidden agenda. 'It shows they have stepped up efforts to keep the functional constituencies in the Legco election in 2020.'

The government has yet to say if it will scrap functional constituencies to ensure all lawmakers are elected by universal suffrage by 2020.