Ed Sheeran breaks down as he performs emotional song about his daughter at friend's funeral

Ed Sheeran surprised guests at the state funeral of Michael Gudinski when he appeared at Melbourne's Rod Laver Arena to pay tribute to the late icon.

Taking to the stage alongside appearances by the likes of Jimmy Barnes and Kylie Minogue, the British singer-songwriter broke down in tears as he performed a new song about his daughter Lyra.

Armed with just an acoustic guitar, the 30-year-old became visibly emotional as he sang the new song 'Visiting Hours,' stopping, before saying "sorry" and returning to the microphone.

The 'Perfect' hitmaker told the audience before his set: "I never get this nervous, I'm really f*****g nervous. So apologies if I mess up the lyrics or anything."

He also revealed he had penned the song during his two weeks in quarantine saying: "So I'm extremely, extremely grateful to be here. I know it's a difficult thing to get into this country and I don't take it for granted for all the hard work getting me here and I really, really just appreciated the opportunity to get here.

"I was able to have a guitar for quarantine I always find the best way to process stuff is to write songs, be it good news, bad news and here's a song I finished last week."

Sheeran also performed renditions of 'Castle on The Hill' and 'The A Team.'

Gudinski was a godfather figure of the Australian music scene, having founded independent label Mushroom Records in May 1972.

He died suddenly in his sleep on March 2, aged 68.