Diageo, the world's biggest distiller, is in talks to buy a stake in billionaire Vijay Mallya's United Spirits, the companies said.

There's "no certainty" the negotiations will lead to a deal, the companies said in a statement today.

Diageo has made acquisitions including Turkey's Mey Icki raki brand as part of its push to expand in emerging markets and cash in on booming economies that are increasing the number of people with disposable income to spend on consumer goods.

Diageo's talks in 2009 to take a minority stake in United Spirits collapsed after the Indian distiller said the UK company's offer wasn't at a fair value. United Spirits shares extended gains in Mumbai after the companies released the statement.

United Spirits gained as much as 4.3 per cent to 1,099.7 rupees, and traded at 1,089.2 rupees at 11:29 a.m. local time.

The distiller's shares have more than doubled in the last year.

Bloomberg