It means they are in the process of negotiations but they haven’t finished making an agreement yet.

It is in the dictionary. For example, this meaning of 'talk' is the first definition of the word as a noun in the Macmillan dictionary. It says when plural, it means discussion in order to reach an agreement.

To be “in talks” with someone basically just means you are in an ongoing discussion. You could also just say “I am talking with” For example, if you were buying a house you might say, “I am in talks with the owner to negotiate a price on this house.”