SEC Digest
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Freddie Mac, Cyclone Power, Fairway: Filings Digest April 16, 2013

In today’s SEC filings digest, Freddie Mac announces multifamily securities offering, Cyclone Power Technologies files its form 10-K, and Fairway Group Holdings set to price its IPO.

Freddie Mac announces multifamily securities offering

Freddie Mac (FMCC) announced on Monday a new offering of approximately $1.2B in multifamily mortgage-backed securities, called Structured Pass-Through Certificates, or K Certificates. This is the sixth such offering in 2013. The company expects to price the securities on April 18th and settle on May 7th. The certificates are backed by 81 recently-originated multifamily mortgages and include two senior principal and interest classes, one senior interest only class, and a junior interest only class. Wells Fargo and Barclays Capital are co-lead managers and joint bookrunners for the offering, while Jeffries, Merrill Lynch, Pierce, Fenner & Smith, Morgan Stanley, and RBS Securities serve as co-managers. DBRS and Fitch will rate the three senior classes of the K Certificates. Freddie expects the rated classes to receive a AAA ratings from both agencies.

Cyclone Power Technologies files form 10-K

Engine developer Cyclone Power Technologies (CYPW) filed its form 10-K with the SEC on Tuesday. Revenue in fiscal year 2012 was $1.13M, a 350% increase from 2011, while gross profit was $483K. The company is forecasting revenue to double in 2013 while revenue in 2014 is anticipated to be even higher when the company shifts from engine prototype to production. Cyclone is approaching its break-even point, with revenues and cash expenditures essentially equal at this point. The net loss per weighted average share was $0.01 in 2012, a significant improvement from $0.15 per share loss in 2011, further illustrating the approach to profitability. In addition to grants and proposals already submitted, the company met its first two milestones under a $1.4M contract with the U.S. Army on the development of compact power generators.

Fairway Group Holdings scheduled to price initial public offering

Fairway Group Holdings (FWM), a grocery-store chain serving the greater New York area, is scheduled to price its IPO today, valuing the business at $453.6M at the midpoint of the price range. The company plans to sell 13.7 million shares priced between $10.00 and $12.00, with the offered shares representing a 33% stake in the company. The valuation, at 15 times  adjusted earnings before interest, taxes, depreciation and amortization, is more expensive than that of peers such as Whole Food Markets and Safeway, which trade at 13 and 5 times, respectively. Though Fairway’s sales increased 14% for fiscal 2012 to $555M, the company had a net loss of $12M for the year. The company, founded in the 1930s, currently has 12 stores and sees the potential to open as many as 300 or more stores in dense metropolitan areas.

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