Transurban Group confirmed that it purchased Sydney's Lane Cove Tunnel for $630.5 billion.

A spokesperson of the toll operator said it would fund the acquisition through the sale of a new equity, including the non-recourse project debt.

Also an owner of the City Link tollway in Melbourne and the M2 motoway which is adjacent to the tunnel, the operator said that its acquisition of the 3.6 kilometer Lane Cove Tunnel in Sydney's north will further increase the company's exposure to the Sydney's north-west area.

The Sydney's north-west corridor is dubbed as one of the city's fastest growing business and residential areas.

"Transurban is the natural owner of the Lane Cove Tunnel and we believe the asset fits extremely well within our portfolio of prime toll roads," Chief executive Chris Lynch of Transurban said in a statement.

Transurban said its distribution control of 12 cents for the second half of this year will remain unchanged as a result of the acquisition and capital raising.

New securities issued will be eligible during the second half distribution.
The purchase of the Lane Cove Tunnel include its assets and its 27-year motorway grant for the tunnel.

Connector Motorways, the tunnel's operator, was put in a receivership in February with debts accounting up to more than $1.1 billion.

The history of the tunnel started in 2007 as a private-public joint venture with the North South Wales government, but it underwent weak changes than its expected traffic numbers.