Avelo Airlines (XP, Burbank) has raised USD42 million in Series B funding after disposing of stock at what it termed, "a significant premium" on its original Series A round wherein it raised approximately USD125 million in January 2020.

According to the carrier, Morgan Stanley Tactical Value (MSTV) is now its largest shareholder after one of its funds invested an additional USD30 million beyond their Series A investment. Other participants in this second-round offering were Series A shareholders including Avelo Founder, Chairman, and CEO Andrew Levy, board members (or the entities they represent), and members of management who collectively invested more than USD34.7 million.

"The incremental capital we've raised is a significant vote of confidence in Avelo's initial momentum and the enormous opportunity ahead of us," Levy said. "This additional capital significantly bolsters our already strong balance sheet and enables the acceleration of Avelo's growth trajectory in 2022 and beyond."

The Texas-headquartered budget carrier currently operates three B737-700s and three B737-800s on flights covering the US West and East Coasts. Bases are at Burbank in California and New Haven in Connecticut respectively. This year, it plans to add nine more aircraft and more than double its network of US destinations from 19 to at least 40.