UK-based Diageo Plc confirmed Tuesday that it was in talks to buy a stake in India’s United Spirits. In a joint London Stock Exchange filing, both the companies confirmed that the talks were on but added that there was no certainty about the deal.

“United Spirits Limited and Diageo Plc confirm that Diageo Plc is in discussions with United Spirits Limited and United Breweries (Holdings) Limited in respect of possible transactions for Diageo Plc to acquire an interest in United Spirits Limited. However, there is no certainty that these discussions will lead to a transaction,” the filing said.

Diageo, the world's biggest drinks company by value, is trying to acquire an at least 25 percent stake in the United Spirits, which is the world’s largest spirit maker by volume and is led by flamboyant Indian liquor baron Vijay Mallya. The company is targeting 10 percent of Mallya’s 28 percent stake in the United Spirits and another 15 percent from other shareholders, Reuters has reported.

Diageo might offer Rs. 1,200 to Rs. 1,300 a share, valuing the 25 percent stake at Rs. 42.5 billion, said sources who wished to remain anonymous because the talks were confidential, according to Reuters.

Mallya is desperately trying to raise funds to retain control of the cash-strapped "Kingfisher Airlines," which is on the verge of a collapse. The creditors of the airline, including the state lender SBI, have asked Mallya to infuse fresh capital into the ailing air carrier to keep it alive.

"(Vijay) Mallya is keen to keep control of Kingfisher (Airlines)... So the sense we have from him is that he is willing to do everything possible, including big sacrifices," said State Bank of India chairman Pratip Chaudhuri Monday.

The SBI leads the consortium of lenders of the debt-laden air carrier and has the maximum exposure of Rs. 14 billion in advances to the company. Kingfisher is in a deep cash crunch and is running its services are in a truncated mode. It has not paid salaries to the staff since February.

However, Sharan Lillaney, an analyst with Angel Broking who tracks both United Spirits and Kingfisher Airlines, said that the deal had nothing to do with Kingfisher Airlines, Reuters reported.

"This has nothing to do with Kingfisher Airlines... This is solely for United Spirits. Why would he put good money after bad money? They are doing a stake sale basically to get United Spirits out of a high-debt position that it is currently in," Lillaney added.

United Spirits' confirmation of the talks raised the company's shares up 8.89 percent to Rs. 1,147.70 Tuesday in the Bombay Stock Exchange Tuesday, and Diageo shares went up by 1.80 percent to 1,755.00 GBP in the London Stock Exchange.