Ibbeson has previously created many iconic statues, including the one of Eric Morecambe that can be seen on the seafront in Morecambe, Lancashire.
Wood's statue is a joint project of Bury Council, in conjunction with the comedian's Estate, on behalf of her children, family and friends. It will remember the comedy star, who died in April 2016 from cancer at the age of 62.
The Council has agreed to provide the site for the statue, in Library Gardens in the centre of the town.
Leader of Bury Council Rishi Shori said: "We are delighted to be working with Graham Ibbeson. We now have an artist who has done some remarkable work creating a sculpture of Victoria for Bury. Victoria visited Eric Morecambe's statue several times and admired Graham's work, so it is very fitting for him to be creating this tribute to such a talented star. I'm sure it will be very popular with her numerous fans, from Bury and across the country."
Graham Ibbeson added: "I am honoured and delighted to be chosen as the sculptor to produce a bronze portrait of the much-loved comedian Victoria Wood. Her unique humour was a product of 'northern roots'; unpretentious, accessible, and well observed. I will try to mirror all these qualities in my sculpture by trying to capture the warmth of her character and personality, and also reflecting the nation's affection (and indeed mine) for her unique talent."
Last year Victoria's brother Chris Foote Wood set up a Crowdfunding appeal to raise money to fund the statue. This appeal will continue to take donations, which needs an estimated further £40,000 "to ensure the statue depicts the best possible representation of Victoria."
Chris Foote Wood says: "I am very pleased indeed that we have been able to obtain the services of Graham Ibbeson. It was his statue of Eric Morecambe that first inspired me to try to get something similar for my multi-talented and much-loved sister Victoria."
Graham Ibbeson will start work on the sculpture soon.