UPDATE 1-Capital One, NetSpend terminate acquisition plan

(Adds Capital One to buy minority stake, Capital One no comment, background)

NEW YORK, Nov 19 (Reuters) - Capital One Financial Corp, (COF.N) a credit card and banking company, said it no longer plans to buy NetSpend Holdings Inc, a prepaid debit card marketer. Capital One said it instead intends to acquire a minority interest in NetSpend, along with the right to buy additional shares in the company. The two companies plan to jointly distribute prepaid cards.

The reason for the move was not disclosed in a statement. A spokeswoman for Capital One declined to comment beyond the statement.

Capital One said in August it agreed to buy NetSpend for $700 million in cash.

Capital One's purchase of an equity position in NetSpend is not expected to affect Capital One's earnings per share in 2008.

(Reporting by Dan Wilchins, additional reporting by Sharangdhar Limaye in Bangalore, editing by Phil Berlowitz)

((Reuters Messaging: dan.wilchins.reuters.com@reuters.net; +1 646 223 6320)) Keywords: CAPITALONE TERMINATION/

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