Sydney has beaten Melbourne in the latest battle of the musicals, with Beautiful: The Carole King Musical opening at Sydney Lyric Theatre in September 2017.

But the NSW government will not reveal how much money was thrown at the producer to lure the award-winning show to Sydney.

A spokeswoman for Destination NSW, Kate Campbell, said its investment in the musical is "commercial-in-confidence".

"Destination NSW is working closely with the [producer] Michael Cassel Group to promote the musical through marketing, digital and communications campaigns to generate awareness of the production and to drive bookings and visitation to NSW, particularly from interstate and regional NSW," she said.

The state government's tourism and events agency pours money into a range of musical and theatre productions as well as events such as Vivid. But Destination NSW has declined repeated requests to disclose how much it invests in shows including less successful productions such as The Addams Family Musical.

The minister for trade, tourism and major events, Stuart Ayres, said on Wednesday that the musical would attract 60,000 overnight visitors and generate $26 million for the NSW economy.

Asked how these figures were determined, Campbell said: "Our research is based on historical analysis of similar events, tourism and ticket booking data and visitor trends derived from a number of sources."

The musical's Australian producer Michael Cassel said there had not been a bidding war for the show between state governments.

Cassel said the decision to stage Beautiful in Sydney was guided by finding the best time to open and the right theatre.

The musical will be the first show in the Sydney Lyric following a major refurbishment that will create a flexible seating configuration, bring the audience closer to the stage and update the theatre's interior décor.

Cassel said the overhaul would improve the front-of-house experience at the Sydney Lyric, which he described as having one of the best backstage facilities in Australia.

Casting for the Australian production will begin later this year.

Beautiful is billed as an "inspiring story" of King's journey from schoolgirl to superstar – first as one-half of a songwriting team with husband and writing partner Gerry Goffin in the 1960s, and later as a solo performer following the disintegration of her marriage.

King shot to fame with her 1971 album Tapestry and its reinterpretations of Will You Love Me Tomorrow and (You Make Me Feel Like) A Natural Woman - both songs feature in Beautiful.

The musical also features hit songs You've Lost That Lovin' Feeling, On Broadway and Uptown by close friends and songwriting rivals Barry Mann and Cynthia Weil.

Beautiful, starring Jessie Mueller as King, opened on Broadway in January 2014 and won two Tony Awards and the 2015 Grammy for best musical theatre album. The London production, which opened in February 2015, won two Olivier Awards.

New York Times critic Ben Brantley called Beautiful a "friendly, formulaic bio-musical" comparing it to Jersey Boys.

"And if Beautiful never acquires the flashy momentum of Jersey Boys, it may come in part from the deferential gentleness of its heroine," he said.

Cassel said King had written the soundtrack to a generation: "Carole King might be a native New Yorker but her music is loved the world over and her story is universal."