Electric vehicle manufacturer Tesla (TSLA) has agreed to acquire parts of Manz AG (DE:M5Z), a German high-tech parts maker that filed for insolvency. The deal includes taking over more than 300 employees at Manz’s site in Reutlingen, Germany, which expands Tesla’s presence in Germany, where it already operates a manufacturing site near Berlin.
As part of the deal, Tesla subsidiary Tesla Automation GmbH will acquire movable assets and property and take over employees from Manz. However, approximately 100 employees will not be transferred to Tesla Automation and will lose their jobs. It is worth noting that both companies agreed not to disclose a purchase price, and the deal still needs to get the green light from regulators before it’s finalized.
The acquisition is an interesting move for Tesla because it is in a market where the company has been facing challenges recently. Indeed, Tesla’s car sales in Germany dropped by almost 60% in January when compared to the same period of last year. Furthermore, the brand’s image has not been helped by CEO Elon Musk’s endorsement of the far-right German political party AfD, which has not been received well by German consumers.
Is Tesla a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 13 Buys, 12 Holds, and 10 Sells assigned in the past three months, as indicated by the graphic below. After a 50% rally in its share price over the past year, the average TSLA price target of $351.38 per share implies 17.2% upside potential.
