Groupon Inc said on Friday that it is cutting some underperforming staff at its Chinese joint venture Gaopeng.

The largest daily-deals website entered China in February through a tie-up with China's Tencent Holdings Ltd and has faced intense competition from the start.

As part of our normal process of establishing a high talent bar, we are optimizing our Gaopeng sales staff and releasing several underperformers, a Groupon spokesman told Reuters. This is a natural part of our growth in China, and was part of Groupon's growth process in most other countries.

The 21st Century Business Herald reported on Friday that Groupon was laying off some staff. Cuts started in April and in June department heads were asked to cut up to 5 percent of employees, the newspaper said.

A spokesperson for Gaopeng said talks of layoffs were just a rumor and there was only some normal personnel adjustment.

Gaopeng, has a small slice of the group-buying market in China, behind more popular sites such as Lashou, Meituan, Wuwutuan.

(Reporting by Melanie Lee and Alistair Barr; Editing by Kazunori Takada, Jacqueline Wong and Gerald E. McCormick)