The owners of Camden Lock Market have won planning permission to start a £20m overhaul of the site that includes opening up a Grade II-listed underground waterway to the public for the first time.

Market Tech Holdings, of which Israeli entrepreneur Teddy Sagi is a majority shareholder, purchased Camden Lock – a popular destination for tourists and Londoners - in 2014 in a deal worth more than £2.3 billion.

The planning permission covers a 130,000 sq ft area in and around the site in north London, which will be refurbished to expand the market area and make space for new restaurants, galleries and an auditorium for live entertainment.

The plans will also create a new path along the canal and open up a section currently not available to the public, known as the Dead Dog Basin.

The proposal also includes permission for 233 food and artisan stalls in the East and West Yards.

Market Tech Holdings, which owns around 15 acres of land in and around Camden, said Camden Council unanimously backed the plans to revamp the site and described it as a “major step” for the company.

“Camden Lock Market's planning permission is a major step in Market Tech's growth strategy through development that maximises opportunities and value for the most iconic market within our estate," said property director Mark Alper in a statement.

Mr Sagi, the Tel Aviv-born businessman who owns Market Tech Holdings, is the controlling shareholder of gaming software development company Playtech, which he listed on London’s AIM in 2006.

Sagi’s firm is the software brain behind Ladbroke and William Hill’s highly successful gaming websites. He briefly dated Israeli supermodel Bar Refaeli in 2009.

Work is expected to start this year in time for completion in 2017.