(Adds CEO comment, context)

COPENHAGEN Jan 14 (Reuters) - Swedish Match and Skandinavisk Holding plan an initial public offering for cigar maker Scandiavian Tobacco Group (STG) on the Copenhagen bourse, STG said on Thursday.

The Augustinus Foundation and The Obel Family Foundation together control 51 percent of STG via Skandinavisk Holding, while Swedish Match controls the remaining 49 percent.

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The planned IPO is expected to consist of a sale of up to 40 percent of the existing shares by the company's two shareholders. No time frame was provided.

"Scandinavian Tobacco Group has an attractive and stable business due to our strong and diverse brand portfolio and the global presence of our business," Chief Executive Niels Frederiksen said in the statement.

The company said sales rose 10.4 percent to 4.97 billion crowns in the first nine month of 2015 while earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 8.3 percent to 939 million crowns.

Analysts have suggested that the company could be valued at 10 to 11 times operating profit, indicating a market capitalisation of around 12 billion Danish crowns ($1.75 billion).

J.P. Morgan Securities, Deutsche Bank and Nordea Markets have been appointed to manage the IPO.

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Carnegie Investment Bank has been appointed co-lead manager while FIH Partners is acting as financial advisor to STG.

It marks the first IPO in Copenhagen since March 2015 when IT services business NNIT debuted on the exchange.

($1 = 6.8682 Danish crowns) (Reporting by Ole Mikkelsen; editing by Mark Potter and Jason Neely)