The company will use the as-yet-untitled magazine to communicate with more than 11m Nectar members and showcase the offers that are available through the scheme.
LMUK marketing director Richard Campbell confirmed that three publishers were bidding for the brief.
Nectar's sponsors and partners are all likely to figure heavily in the magazine, which will target customer segments according to their interests.
The magazine is likely to be distributed by post and could be available in the retail outlets of points-issuing partners such as BP, Sainsbury's and Debenhams.
The initiative will form part of Nectar's strategy to build relationships with programme members.
Separately, Barclays Bank is thought to be in negotiations to join Nectar as its retail banking partner.
The move would see customers offered rewards on their current accounts and other financial products.
It would make a sensible fit for the scheme, in which Barclaycard has been involved since its launch.
LMUK refused to comment on Barclays Bank's potential involvement in the Nectar programme, which launched last October.
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