Prime Drink Group Corp. (CSE: PRME) has signed a non-binding letter of intent with GefCo, a company within Les Entreprises du Groupe Geloso, to form a strategic partnership for the distribution, marketing, production and development of its Beach Day Every Day (BDED) beverage brand across Canada outside Quebec, the United States and Europe.

Under the proposed structure, Prime and Geloso would each hold a 50% stake in a newly incorporated company, to be managed by Aldo Geloso. Prime would contribute the BDED assets to the new entity, while Geloso would oversee operations and management across the defined territory.

The parties intend to negotiate a definitive agreement granting Geloso exclusivity over distribution, co-manufacturing, agency, pricing and bottling in the territory for an initial five-year term.

According to the press release, BDED currently generates tens of millions of dollars in annual sales in Quebec through a collaboration with a Canadian brewing industry partner.

Jean Gosselin, Chief Financial Officer of Prime, said: "We are extremely proud to partner with Geloso. Their recognized expertise, production capacity and extensive network are major assets in accelerating the development of Beach Day Every Day across the rest of Canada, the United States and Europe."

Geloso is a Quebec-based, family-owned group with more than 60 years of experience in the beverage industry. The group operates more than 50 brands and more than 250 products manufactured in Quebec, employs more than 500 people and has facilities in Canada, the United States and Europe.

Completion of the partnership is subject to several conditions, including satisfactory due diligence by Geloso, completion of a previously announced transaction involving the acquisition of all issued and outstanding shares of Prime Capital Investments Inc., receipt of required third-party approvals, and execution of definitive agreements. There is no assurance the partnership will be completed on the terms described or at all.