When Nestlé,a Swiss company,purchased Ralston Purina,a U.S.company,Ralston Purina became a foreign licensee.
When one firm purchases another firm in a foreign country the purchased firm is called a foreign subsidiary.

Question

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When a firm purchases another firm in a foreign country, the purchased firm becomes a foreign subsidiary, not a foreign licensee. A foreign licensee is a company that has been granted permission to produce or sell a product in a foreign market under a licensing agreement.

When Nestlé,a Swiss Company,purchased Ralston Purina,a U