The publisher, owned by Richard Desmond, plans to spend £10 million on the launch over three years. Creative for the B Happy launch will be handled in-house.
In appointing M2M, which is owned by Manning Gottlieb OMD, Northern & Shell has overlooked MediaCom North, which handles media for other Northern & Shell titles including OK! and New.
B Happy, said to be a glossy fashion title, will launch on 6 April. Northern & Shell has appointed the former Tatler editor Jane Procter as consultant editor.
Northern & Shell was also thought to be looking at launching a men's weekly title, called KO!, but plans have yet to be confirmed.
Stan Myerson, the group joint managing director at Northern & Shell, said: "I was impressed with M2M's ideas and its creative ideas in particular. The agency was hungry and keen."