TD Bank’s Kory Wilcox shares why middle market dealmakers are cautiously optimistic and how sponsors are getting creative in a market that’s still finding its footing.
The middle market hasn’t had it easy—interest rates remain high, trade dynamics are in flux, and deal flow has been slower than anyone would like. But according to Kory Wilcox, who leads middle market sponsor finance and buy-side loan syndications at TD Bank North America, there’s reason for optimism. In a recent conversation with ABF Journal Editor-in-Chief Rita Garwood, Wilcox gave a candid look at current trends, sponsor behavior, and how TD is helping clients stay nimble in an evolving financial landscape.
Rita Garwood: What’s the current sentiment in the middle market?
Kory Wilcox: I would say probably cautiously optimistic. We’ve certainly seen deal activity pick up over the last month… We’re still not seeing the tremendous amount of sponsor-to-sponsor M&A volumes that we would like, but we’ve seen the M&A markets pick up more as it relates to add-ons.
Garwood: How are middle market executives adjusting to the constant changes—interest rates, tariffs, and all the noise?
Wilcox: Operators are starting to become more comfortable operating in this market of kind of continued uncertainty as more and more trade deals are negotiated, I do think it’ll allow executives to better plan for upcoming capital allocation strategies — they’re constantly recalibrating.
Garwood: Has that uncertainty kept capital on the sidelines?
Wilcox: Yeah, I think you’re seeing more capital sitting on the sidelines. Where we did see pockets of activity were more in certain sectors of U.S.-based services, consumer — maybe notably food and beverage — and those industrial companies, which were not quite as affected by the tariff environment.
Garwood: You’ve talked about creativity in deal structuring — can you elaborate?
Wilcox: It seems like they’re always thinking creatively. They have the full breadth of capital providers available at their disposal. Where TD is unique, we can provide those solutions to clients. We’re often talking with them and approaching a client with a menu of options and discussing the pros and cons of each.
Garwood: How are financial sponsors evolving in this environment?
Wilcox: They’ve become a bit more inward-focused, making sure the cost structure is absorbed. But that said, it’s also a good time to pick up the strategic add-ons, which can also provide further diversification and scale.
Garwood: Are you seeing renewed momentum in M&A deal flow?
Wilcox: Yes, I would say we are. The amount of acquisition financings and new platforms or LBOs have really picked up since the beginning of July. While it’s still slower than we would like, we’re certainly seeing green shoots in there.
Garwood: What’s going on with valuations? Are sellers adjusting expectations?
Wilcox: It does feel like we’re still operating in a bit of a discounted valuation environment, but I do feel that we’re seeing some thawing in that spread standoff, given the amount of activity that we’ve seen even just over the past couple months.
Garwood: How is TD Bank positioning itself to support clients right now?
Wilcox: We have a very clean portfolio to date. We’re very much open for business. The main thing is just proactive communication. The more time that we have, the more creative we can become.
Garwood: How do you help hesitant clients balance risk and opportunity?
Wilcox: “It’s something that should be balanced in any market. In a somewhat slower deal environment, where competition to win new clients is heightened. it allows the companies to drive better terms, but the last thing we would ever want to do is press someone into a decision they’re not ready to make.
Garwood: If interest rates start to ease, what kind of market activity do you expect?
Wilcox: We could see a tremendous amount of activity in the back end of this year and into 2026, should interest rates begin to come down. I know our M&A partners on the TD Securities side have certainly been actively pitching throughout the year, which leads me to believe business leaders are already preparing for that shift.
Garwood: Any closing thoughts?
Wilcox: We certainly remain open for business and look forward to supporting our clients as they navigate this uncertain time.