South Sudan's president and rebel leader Riek Machar are flying for face-to-face peace talks in Ethiopia, a foreign ministry spokesman said Tuesday, to try and end two weeks of fighting feared to have left thousands dead.

"Both President Salva Kiir and Dr Riek Machar are coming to Addis Ababa for talks, they are coming now and should meet today," Ethiopian foreign ministry spokesman Dina Mufti told AFP.

The world's youngest nation plunged into chaos on December 15 when Kiir accused his former deputy Machar of mounting a coup. Machar in turn has accused the president of using a clash between army units as a pretext to carry out a violent purge.

Regional leaders at the Inter-Governmental Authority on Development (IGAD), an East African grouping, have demanded Machar agree to a ceasefire and hold face-to-face talks with Kiir by Tuesday.

Ugandan President Yoweri Museveni has warned that Machar must comply with the ceasefire deal by Tuesday or face action by regional nations. He said if Machar does not respond "we shall have to go for him," without clarifying if his threat involved military action.

Thousands of people are feared to have been killed in over two weeks of fighting, pitching army units loyal to President Salva Kiir against a loose alliance of ethnic militia forces and mutinous army commanders nominally headed by ex-vice president Riek Machar.

Ethiopia's announcement of peace talks between the rivals came as rebel spokesman Moses Ruai claimed to have recaptured the key town of Bor after a pre-dawn assault on government forces.

"Bor is under our control... we are now in Bor town now," Ruai told AFP.

However, army spokesman Philip Aguer said that fighting was still ongoing, and rejected the claim.

"There is still fighting in Bor, the fighting is not yet finalised," he said.

There have also been grim reports of massacres, rapes and killings, prompting the African Union to threaten "targeted sanctions" over the conflict.