We study the effect of AGN mechanical and radiation feedback on the formation of bulge dominated galaxies via mergers of disc galaxies. The merging galaxies have mass-ratios of 1:1 to 6:1 and include pre-existing hot gaseous halos to properly account for the global impact of AGN feedback. Using smoothed particle hydrodynamics simulation code (GADGET-3) we compare three models with different AGN feedback models: (1) no black hole and no AGN feedback; (2) thermal AGN feedback; and (3) mechanical and radiative AGN feedback. The last model is motivated by observations of broad line quasars which show winds with initial velocities of $v_w ge$ 10,000 km/s and also heating associated with the central AGN X-ray radiation. The primary changes in gas properties due to mechanical AGN feedback are lower thermal X-ray luminosity from the final galaxy - in better agreement with observations - and galactic outflows with higher velocity $sim 1000$ km/s similar to recent direct observations of nearby merger remnants. The kinetic energy of the outflowing gas is a factor of $sim$ 20 higher than in the thermal feedback case. All merger remnants with momentum-based AGN feedback with $v_w sim 10,000$ km/s and $epsilon_w=2 times 10^{-3}$, independent of their progenitor mass-ratios, reproduce the observed relations between stellar velocity dispersion and black hole mass ($M_{rm bh} - sigma$) as well as X-ray luminosity ($L_X - sigma$) with $10^{37.5}$ erg/s $lesssim L_X (0.3-8~{rm keV}) lesssim 10^{39.2}$ erg/s for velocity dispersions in the range of 120 km/s $lesssim sigma lesssim$ 190 km/s. In addition, the mechanical feedback produces a much greater AGN variability. We also show that gas is more rapidly and impulsively stripped from the galactic centres driving a moderate increase in galaxy size and decrease in central density with the mechanical AGN feedback model.