* Porsche denies report Piech holding up Qatar deal
* Porsche says Volkswagen should not interfere in talks
* Sovereign wealth fund makes $7-$8 bln profit in Q1
* Qatar to remain long-term investor in Barclays
(Adds Porsche statement, background, share prices)
By Dania Saadi and Christiaan Hetzner
DUBAI/FRANKFURT, June 17 (Reuters) - Qatar expects to reveal the outcome of talks on buying a stake in ailing German sportscar maker Porsche SE in two to three weeks, the country's prime minister said, according to media reports.
"We are still discussing the stake. According to the legal agreement between the two parties, neither of them is allowed to disclose any information about it before it is sealed," the Gulf Times quoted Sheikh Hamad bin Jassem al-Thani as saying.
The talks are centred around the size of the stake, Sheikh Hamad said in remarks carried by the Qatar News Agency.
Porsche SE amassed a 9 billion euro ($12.5 billion) net debt pile in its aborted attempt to acquire 75 percent of Volkswagen AG votes and had looked to rescue itself by uniting with its cash-rich subsidiary, which is Europe's largest carmaker.
VW has rejected the overtures as long as Porsche's finances are in a shambles.
Most of the family members which own Porsche SE were hoping Qatar could inject billions in fresh capital to bolster their negotiating position with VW, in which Porsche owns just over half the votes.
The families have been examining the sale of a 25 percent stake that would grant the Gulf state a blocking minority.
Ferdinand Piech, a Porsche scion and chairman of Volkswagen who is known to be sceptical about the deal, reportedly prevented a quick preliminary agreement in favour of Qatar during a meeting of Porsche SE's owners on Monday in Austria.
But a Financial Times Deutschland story to this effect was denied by Porsche SE, which called the report a "transparent diversion".
LACKING BASIS
"The family stands united behind talks with an investor. There was no such family meeting at which Ferdinand Piech had prevented an agreement with Qatar to quickly buy a stake in Porsche," it said.
"There is also a consensus within the family that the demand from Wolfsburg (where VW is headquartered) that Qatar must first hold talks with Volkswagen management and labour before buying a stake wholly lacks any basis. Qatar is purely an issue for the controlling families and will only be dealt with by Porsche."
A source close to the clans confirmed the families had met on Monday but declined further comment.
Porsche shares fell as much as 5 percent before paring losses to trade down 1 percent at 45.30 euros by 0922 GMT. VW shares slipped 1.6 percent.
Qatar's interest in Porsche highlights the increasing role of Arab states in German carmakers after Abu Dhabi's state-owned IPIC bought a 9.1 percent stake in Daimler AG in March, making it the largest shareholder after Kuwait.
Gulf Arab sovereign wealth funds and investment companies, which suffered losses from investments in companies such as Citigroup, are eyeing new ventures as they look for bargains and ways to get returns on their oil income.
Sheikh Hamad said the Qatar Investment Authority made a profit of between $7 billion and $8 billion in the first quarter of 2009, the news agency and local dailies said.
"It is not true that our investments are only in the euro zone. We have some in Asia," the media reported Sheikh Hamad as saying.
Sheikh Hamad also said depreciation in Qatar's overseas assets due to the financial turmoil resulted in a loss of about $4 billion in 2008, media said.
Qatar's fund, which also has stakes in Credit Suisse, also remained a long-term investor in Britain's Barclays, the prime minister was quoted as saying.
His remarks come after IPIC sold more than 11 percent of Barclays, making $2.5 billion from an investment that helped the British bank through the financial crisis.