Fintech firm Nivaura has served as the London Stock Exchange Group’s (LSEG) partner in the development of the group’s digital primary DCM Flow platform.
The DCM Flow platform’s efficiency and validity have reportedly undergone testing with its use in a $7 billion syndicated issuance by the LSEG (as part of an international MTN program). The LSEG has priced a syndicated multi-tranche and multi-currency offering securing around $7 billion equivalent across 9 different tranches.
This marks the very first time that Flow was used to carry out major transaction steps by deal parties in the issuance process. Flow aims to offer end-to-end automation in primary debt markets and was created with assistance from Nivaura.
Flow has been developed to automate and streamline the debt capital markets issuance process by using structured data and General Purpose Legal Mark-Up Language (GLML), which Nivaura has invented.
The LSEG issuance is notably the most complex transaction that has used a primary DCM digitization platform. The bonds have reportedly been listed on the Main Market of The London Stock Exchange. They were settled in DTC, Euroclear, and Clearstream. This issuance is considered a key milestone in capital markets automation and digitization and shows the potential of these types of platforms when it comes to enhancing capital market workflows.
During the past few years, Nivaura claims it has taken a lead role in new technology in order to bring efficiency to primary markets, while regularly communicating with regulatory authorities and professionals working in capital markets.
Nivaura aims to address the complex issues related to negotiation processes and related documentation of structured data in primary markets. Nivaura’s digital and automated workflow products are product-agnostic (for example, between cash-settled products and tokenization).
Nivaura claims its products are flexible and come with configurable implementation options such as private cloud or on-premise deployment; customizable functionality and white-labeling; and real-time workflows that can adapt according to external data.
Nivaura says it has pioneered the development of the General-purpose Legal Mark-up Language (GLML), which is described as a human-readable mark-up language meant for easy use by legal professionals or other individuals who might not be familiar with computer programming.
GLML has been designed to make legal documents machine-readable, allowing transaction details in the files to be extracted as “structured data.” GLML has been developed with debt capital market transactions (especially high volume MTN and CP issuance) as a key use-case in mind, however, it may potentially be used in many other applications or scenarios.
Created by Nivaura, GLML is governed by the GLML Foundation, an independent organization that includes various capital market participants. This market ownership aims to support the vision for GLML to serve as an open-source, universal data standard that market participants and tech providers may use, in order to ensure the inteoperability of digital and workflow platforms.
Dr. Avtar Singh Sehra, Founder and CEO at Nivaura, stated:
“It has been an honour for Nivaura to work closely with the LSEG, and Allen & Overy, in bringing the LSEG Flow platform to market and supporting its launch with LSEG’s debut multi-currency and multi-tranche transaction. This is the start of a new digitisation and automation paradigm in the primary capital markets, where the LSEG Flow platform delivers proven technology to drive efficiency and effectiveness for all market participants. For Nivaura, our work here illustrates the flexible ways in which our expertise and solutions can be deployed with partners. We foresee a range of different approaches to primary markets efficiency being pursued, and we’ll act in line with our vision to fully digitise and automate primary markets.”
Sehra added:
“Cutting complexity, time and cost out of primary capital markets by digitising, automating and optimising workflows is now a matter of urgency. GLML will play a crucial role in ensuring different new platforms can be interoperable, ensuring the market benefits fully from digitisation and automation.”