Renault SA shares rose in early trading on the Paris stock exchange Tuesday after a newspaper reported the French car maker could swap stockholdings with Mercedes owner Daimler AG.

Renault declined to comment on the report in the Financial Times, which cited "two people briefed on the matter" as saying talks on jointly building small cars — revealed by the companies in December — had widened to include the possible exchange of ownership stakes.

Daimler spokesman Florian Martens said that Daimler is in ongoing talks for a partnership with several companies including Renault, though wouldn't name any other companies or say how the talks are progressing.

"Within the first half of the year, we'll provide details on the content of the talks," Martens said.

Renault shares rose as much as 2.1 percent to euro34.28 ($46.98), their highest level since early February.

Shares of Daimler were 1.23 percent higher at euro33.74 in Frankfurt afternoon trading.

Renault disclosed in December that it was talking with potential partners, including Daimler, about ways to cut costs or boost volumes as it struggles to get its crisis-ravaged finances in better shape.

Speaking earlier this month at the Geneva Auto Show, Renault Chief Executive Carlos Ghosn declined to discuss the state of any talks with Daimler, saying Renault is talking to many industry players.

"The name of the game is scale and co-investment and sharing technologies. There are a lot of talks and we don't communicate before we reach agreement because sometimes these talks collapse," Ghosn said.

Late last year a Daimler official familiar with the situation though not authorized to speak with the media, said Daimler and Renault were discussing cooperation on a new four-door Smart car, the company's small car brand.

The Smart brand, which currently only offers two-seater models, is produced in Hambach, in northeast France.

Smart produced a four-door model before, the Smart Forfour between 2004 and 2006, which it developed with Mitsubishi Motors, though it stopped production of the model, along with its two-seat Roadster because the company was not profitable at the time.

Daimler has said in the past it would seek a partner to develop the Smart project because it makes more sense financially.

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AP Business Writer George Frey in Frankfurt contributed to this article.

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