What happened

While the S&P 500 and Dow Jones Industrial Average are starting the week in the red, shares of Coeur Mining (CDE -6.79%) are glittering brightly in investors' eyes. The source of investors' enthusiasm is Coeur Mining's announcement that it has agreed to sell assets located in Nevada.

As of 3:02 p.m. ET, shares of Coeur Mining are up 15.3%.

So what

Inking a deal with a subsidiary of AngloGold Ashanti (AU -2.72%), Coeur Mining has agreed to sell its Crown Sterling Holdings for a closing cash consideration of $150 million. The exploration properties located in southern Nevada total about 35,500 acres and are located in proximity to AngloGold Ashanti's other exploration properties in the area. Coeur Mining is eligible to receive an additional $50 million in deferred cash consideration should Crown Sterling attain a total resource of at least 3.5 million gold ounces.

According to Coeur Mining's president and CEO, Mitchell Krebs, the transaction is a positive move for investors. "The divestiture of Crown Sterling unlocks significant value for Coeur stockholders and demonstrates our ongoing commitment to allocating capital into our existing portfolio of near-term core growth projects, highlighted by the Rochester expansion in northern Nevada," Krebs said in a statement.

Coeur Mining expects the deal to close in the fourth quarter of 2022.

Now what

While Coeur Mining is saying goodbye to some of its assets, investors seem content with management's decision -- and rightfully so. Coeur Mining has seen a steady increase in its leverage over the past year. As of the end of the second quarter of 2022, Coeur Mining had a ratio of net debt to adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of 2.9, representing a sharp increase over the multiple of 1 that it had at the same time in 2021. The closing of the deal with AngloGold Ashanti will provide it with some cash to lessen the company's reliance on leverage, strengthening its financial position.