Mouse Works but is Undiscoverable

Brand-new magic mouse works out of the box, but I can't set it up to scroll, swipe, etc. When I go to System Preferences > Mouse > Set Up Bluetooth Mouse, it searches and searches but I only get the "No mouse found" message. I tried:

• Restarting both mouse and iMac (late 2012 running 10.10.5)
• Shutting down iMac, unplugging, holding down power for 5 seconds, replugging, and restarting
• Repairing permissions
• Turning Bluetooth off and then on
• Shutting off (and removing) wireless (I'm on ethernet)
• Removing Bluetooth pan
• Zapping pram
• Renaming the mouse

Again, the mouse works to move the cursor around and to click, but other than that my iMac can't seem to find it. Help!