Porsche plans overshadow VW rating: S&P

FRANKFURT (Reuters) - Questions surrounding sports car maker Porsche's (PSHG_p.DE: Quote, Profile, Research, Stock Buzz) intentions for raising its 31 percent stake in Volkswagen (VOWG.DE: Quote, Profile, Research, Stock Buzz) are affecting prospects for a VW credit rating upgrade, a top S&P analyst said.

"We are concerned because it adds to uncertainty," the head of Standard & Poor's European automotive team, Maria Bissinger, said at the Reuters Autos Summit in Frankfurt on Tuesday.

"Looking at the financial structure of Volkswagen, the question could be asked whether there is upside potential in the rating but the uncertainty on the other hand is on the ownership structure," she said.

S&P rates Volkswagen, Europe's biggest carmaker, A- with a stable outlook.

The way is clear for Porsche to increase its VW stake to a majority after a European Union court last month struck down a German law capping voting rights at Volkswagen.

Porsche has said it has options that would let it boost its stake in VW significantly, but it made no comment on its potential strategy after its latest supervisory board meeting on November 12 other than to say it had not discussed VW.

One source familiar with the situation has said Porsche was unlikely to raise its VW stake before next year.

S&P has already cited potential conflicts of interest given Porsche's role as VW's largest shareholder as well as a competitor and business partner.

It has also highlighted Ferdinand Piech's links to VW, including his role as VW chairman; his family's control of Porsche; and his other business interests, which include both VW and Porsche through Porsche Automobile Holding SE.

Bissinger said it was unclear how a higher Porsche stake in VW would be financed. "That is something we would not like to speculate about but it certainly adds to the uncertainty," she said.

Another issue hanging over VW's credit rating is its potential role in a three-way trucks merger which it desires with Germany's MAN (MANG.DE: Quote, Profile, Research, Stock Buzz) and Swedish group Scania (SCVb.ST: Quote, Profile, Research, Stock Buzz).

"They have not said they want to be the consolidator in the truck industry themselves but they have made clear they think there is a very good economic reason for truck industry consolidation so this is something where there is also uncertainty and the outcome is unclear," she said.

(For summit blog: summitnotebook.reuters.com/)

(Reporting by Michael Shields)