TeraWulf announced $3.5 billion AI data center buildout plan.

TeraWulf Inc. (WULF) shares jumped nearly 7% on Thursday following reports that the company plans to raise approximately $3.5 billion in debt to finance a new artificial intelligence-focused data centre campus in Kentucky. The financing would mark TeraWulf's first-ever venture into the leveraged loan market.

The company intends to raise the capital through a combination of its first leveraged loan and high-yield bonds, with Morgan Stanley leading the financing effort. According to Chief Financial Officer Patrick Fleury, the deal is expected to launch this year. TeraWulf previously sold $1.3 billion in high-yield bonds in December and $3.2 billion in October.

TeraWulf, which has transitioned from its cryptocurrency roots to focus on artificial intelligence infrastructure, signed a 20-year lease with Anthropic PBC on Monday for its Kentucky facility. The agreement is projected to generate approximately $19 billion in revenue over its term and includes two five-year extension options. Anthropic has additionally agreed to lease computer chips at two other TeraWulf data centres.

The campus, known as Justified Data, is being constructed in Hawesville, approximately one hour from Louisville. Many of the lenders that participated in TeraWulf's $250-million revolving credit line earlier this year could also participate in the Justified Data financing, Fleury indicated.

Morgan Stanley raised its price target on TeraWulf to $72 from $66.50 on Wednesday, implying more than 215% upside from the stock's last closing price, while maintaining an "Overweight" rating. The stock has surged nearly 108% year-to-date.

On Stocktwits, retail sentiment for WULF remained "extremely bullish" with "extremely high" message volume. Over the past seven days, message volume has surged 191%, while the ticker's watcher base has risen 4.6% in the same period, indicating growing retail interest in the stock.