A second beverage alcohol firm in China has moved to deny reports that it is in talks to sell a stake in the company to Diageo.

Gansu Huangtai Wine-Marketing Industry Co. told the Shenzhen Stock Exchange that it has not held talks with Diageo, despite reports in China claiming the two companies are in negotiations.

Diageo declined to comment on what it called "market speculation".

Last month, Chinese spirits group Sichuan Swellfun Co. denied it was in sales talks with Diageo - but said it was in discussions with the UK drinks giant over "business co-operation".

Diageo is looking at bolstering its presence in China after watching arch-rival Pernod Ricard gain a march with its stable of premium spirits, including Chivas Regal Scotch whisky and Martell Cognac.

Just-drinks understands that Diageo has held low-level talks with a number of domestic Chinese spirits groups on the prospect of possible co-operation, though nothing concrete has been finalised at this stage.