Tesco may shut 13 smaller stores in Hungary -report

BUDAPEST, Jan 10 (Reuters) - Tesco (Xetra: 852647 - news) could close up to 13 smaller shops in Hungary as part of a cost-cutting drive, the daily Magyar Nemzet reported on Saturday, citing unnamed sources.

Tesco is Hungary's biggest supermarket chain. It has more than 200 stores and is the central European country's third-biggest employer.

Tesco declined to comment on the report.

The newspaper said Tesco may shut down the loss-making shops, mainly outside Budapest, next month. More stores may be shut later this year.

Britain's biggest retailer plans to slash costs and sell assets to fund lower prices and mend its finances as its new boss set out a plan to fight back from years of market share losses and an accounting scandal.

In Hungary, Tesco and other major retailer were also hit with a steep rise in food inspection costs and a new law that would force the closure of loss-making chains after two successive years in the red.

Rival Spar said last month it would scrap over half of a planned 59 million euro ($69.88 million) investment programme in Hungary in 2015, blaming recent tax changes targeting major players. ($1 = 0.8443 euros) (Reporting by Gergely Szakacs, editing by Louise Heavens)