Dubai's Meydan LLC has cancelled a US$1.3 billion racecourse construction deal with Malaysian firm WCT Bhd and Dubai's Arabtec Construction LLC.

WCT said in a statement to the Malaysian stock exchange that the firm and its joint-venture partner Arabtec have been given a fortnight's notice by Meydan to cancel the project.

"The board views the cancellation as a breach of contract on the part of (Meydan)," WCT said in the statement, which did not give any reason for the cancellation.

WCT said the joint-venture partners would consider their options and "take the necessary steps" to protect their interests.

WCT did not give any reason for the cancellation, but in a statement to Dow Jones Newswires , Meydan said that WCT and Arabtec failed to stick to the time schedule for the construction of the racecourse.

"The phases of the completion of the main stand and the infrastructure works for the horse racing course at Nad Al Sheba which had been awarded to Arabtec and WCT of Malaysia has shown considerable delay in implementation," a Meydan official said.

Meydan, which last year commissioned a 50-50 joint venture of WCT and Arabtec to build the racecourse, said the contract was cancelled 'because of non-adherence to the agreed time schedule for construction'.

The developer said other contractors will continue working on the mega-project "so as to inaugurate the project on the targeted schedule."

The racecourse has to be completed by next year, where it will be the venue for the Dubai World Cup horse race.

Trade in WCT shares halted

WCT announced in September that it had been awarded the contract to build the racecourse.

The project includes a 60,000-seat grandstand, a 1km racetrack, a five-star hotel, several restaurants, a museum and gallery as well as parking for more than 10,000 cars.

The project was originally due to be completed in October this year.

Shares in WCT plummeted nearly 30 percent on news of the decision.

WCT shares fell 29.5 percent before the company requested for a halt in trading.

If the shares shed more than 30 percent, it would have triggered an automatic suspension of trade on the stock market.