Toronto, Canada – By Alan Baldwin
"This is a team that has just won both championships this year, they have Mercedes now as a strong partner so our aim can only be to fight for the championship," the seven-times champion told reporters in a conference call.
"Having played around with motorbikes, I feel ready for some serious stuff."
"We are talking about a three-year deal, it's not just a one-off thing," he said of a contract that had been expected to last just one year. "We are looking for continuation."
"It was the only combination that would have triggered it (my return) there was no other combination that I would have liked to have worked for and with," Schumacher told the BBC.
"Ross is a long-term friend and he knows me in detail. We've won races together we shouldn't have won, we've had tough times, good times but we managed to finish on a positive attitude. I feel very inspired and really great to deliver something."
Brawn told reporters that he had approached Schumacher only in late November when contract negotiations with Button hit difficulties.
Wednesday's announcement will take Schumacher's career full circle, since the German drove for the Mercedes sportscar team before breaking into Formula One with Jordan in 1991.
"I am happy to be able to give something back that Mercedes gave in the early days," Schumacher said.
"I can say 100 per cent that the neck is no further an issue," he said. "Unfortunately, it was too close to the accident in the summer when I tried for Ferrari. Time now is enough for it to have healed completely."
The German said he was thrilled to be back. He added that his wife and family were also supportive.
"I was tired of F1 by the end of 2006, but after three years of absence I am getting back all the energy and I feeling strong right now," he told reporters.
Schumacher will be returning to a very different grid from the one he left after a record 91 wins. BMW, Honda and Toyota have all left in the past year and budgets have been slashed.
Schumacher's return will also allow 2008 champion Lewis Hamilton, who entered the sport only after Schumacher retired, to measure himself against Formula One's most successful driver while setting up an intriguing Anglo-German battle.
Hamilton and 2009 champion and compatriot Button will form an all-English pairing at rivals McLaren.
There will also be a battle of the generations, with Schumacher lining up on a starting grid likely to include at least one driver half his age.
(Editing by Ed Osmond and John Mehaffey)