Karimloo will be an associate producer on the show and is joined on the project by Les Miserables cast-mate Hadley Fraser who has written the book for the production.
Others involved in the show include magician Jamie Allan, who conceived the musical and will act as its magic consultant, and composer Simon Wheeler.
The show is currently looking for a West End theatre for autumn next year.
Whatsonstage.com says the "show was launched in a cloud of social media buzz yesterday." A website has also been launched at: www.houdinilondon.com