Google (GOOGL) could replace Anthropic as TeraWulf's (WULF) tenant on $19 billion of leases if Anthropic defaults

Google (GOOGL) has agreed to backstop certain of Anthropic's obligations on about $19 billion of leases at a TeraWulf (WULF) data center campus in Hawesville, Kentucky, TeraWulf said on November 4. If Anthropic misses its rent or goes bankrupt, Google has the option to take over as the tenant, according to TeraWulf's 8-K.

TeraWulf's press release calls this support for the debt it plans to raise for the campus. Lenders would be counting on Alphabet's AA+ rating from S&P along with Anthropic's rent. The backstop can end once Anthropic earns an investment-grade credit rating and keeps it for at least three months.

TeraWulf shares were at $12.95 in premarket trading as of 9:26 a.m. ET, up about 3.4% from their November 3 close of $12.53.

What did Google agree to do?

A backstop is a promise to step in if someone else can't pay. The press release stops about there, but TeraWulf also filed the form of the agreement, and that's where the details are. There are three agreements, one for each leased building.

Google's duties begin once the last data hall in a building has been delivered. TeraWulf expects deliveries to run from late 2027 through the second quarter of 2028. If Anthropic defaults or goes bankrupt before then, TeraWulf can finish the building, and the backstop applies when that date arrives.

After a default notice, Google gets 30 days to verify what happened. Then it has two choices. It can pay the rent that's due and take over the lease, or it can let the lease end and pay a termination fee. If Anthropic has only missed a payment and isn't bankrupt, Google can also cover the rent for a while and put off that decision.

Why can't Google walk away for six years?

This is the part of the agreement that stood out to me. Google can't choose the termination fee during the first six years after the backstop takes effect, with one exception. It can do so if the Google chip systems installed in the building could use less than 50% of the power that's set aside for Anthropic.

If Google doesn't respond in those six years and that exception doesn't apply, the agreement treats it as having taken over the lease. So in a default during that stretch, TeraWulf would keep its tenant and swap Anthropic for Google, unless Google covers the rent for a time first.

After six years, Google can choose the fee. The dollar amounts are blank in the filed form, but the fee schedule was built around the debt TeraWulf expects to take on for the project, and the fee falls over time. Paying it would cap Google's liability. Google could then choose to take an equity stake in TeraWulf's subsidiary Raylan Data, sized by dividing the fee by the total cost of the project.

Why does the agreement mention Google's chips?

Anthropic gives up some choice in exchange for the support. "Tenant (and any Affiliate thereof) shall use only Google-approved tensor processing units for accelerator processors in the Premises for the entire term of this Agreement," the form says.

Tensor processing units, or TPUs, are the AI chips Google designs. Anthropic's amended IPO filing says it runs Claude on four chip families, from Amazon (AMZN), Google, Nvidia (NVDA), and AMD (AMD). In these buildings, the chips have to be TPUs that Google has approved for as long as the agreement lasts.

That may help explain the 50% test. Google has agreed to stand behind a building that's meant to be full of its own chips, and the six-year promise loosens if the building isn't.

What does Anthropic say about relying on a rival?

Anthropic's filing warns about this kind of arrangement without naming anyone. It says certain deals depend on "credit support provided by a third party that is also a competitor, the loss or impairment of which could jeopardize the underlying arrangements." Google, which makes the Gemini models, competes with Anthropic and is also one of its chip suppliers.

The filing also says part of Anthropic's buildout has relied on credit support from its cloud and chip partners, and that reducing that reliance depends in part on financing "on our own credit." An investment-grade rating from S&P, Fitch, or Moody's would count in this deal. Anthropic's credit agreement sets a different test for releasing its collateral, which is ratings from at least two of the three. That rating isn't a sure thing. The Financial Times reported on October 30 that Blackstone told investors Anthropic may not secure an investment-grade rating after its IPO.

If Google has to cure a default, Anthropic owes it the money back plus a 5% administrative fee.

How does this compare with Google's last TeraWulf backstop?

Google has done this with TeraWulf before. In August 2025, it raised its backstop of Fluidstack's leases at Lake Mariner in New York to about $3.2 billion, a deal we list on our AI debt tracker. Google received warrants in return, which took its potential stake in TeraWulf to 14%.

The new filings don't mention warrants. They also don't say whether Anthropic is paying Google for the support. What's visible is the chip requirement, the repayment terms, and the possible stake in Raylan Data if Google ever pays the fee.

In July, TeraWulf said the Anthropic lease was expected to be supported by an investment-grade credit, without naming one. Now we know it's Google. We list the lease on our AI compute commitments tracker.

What don't we know yet?

Several pieces are still missing. The schedules with the termination fee amounts were left out of the filing. Raylan Data and Anthropic also amended the leases on November 4, and the 8-K doesn't describe the changes.

The debt isn't done either. TeraWulf calls it anticipated financing, and Bloomberg reported in July that it was looking for about $3.5 billion. The new Fluor (FLR) construction deal for the three buildings still needs its guaranteed maximum price, which TeraWulf says will be set as engineering and procurement move along.

The loan terms should show how much of this risk lenders think Google has taken on.