The Gauteng government has admitted that the construction of a multi-million rand hospital in Jabulani, Soweto, has been a disastrous flop.
The contractors, Ilima Joint Venture, did not have a tax clearance certificate to do government work. Three of the four partners have pulled out.
The Gauteng government said it had "tried at least three times to stabilise the Ilima Joint Venture".
But Gauteng department of public transport, roads and works head Sibusiso Buthelezi "took immediate steps to terminate the contract", departmental spokesperson Alfred Nhlapo said.
He confirmed that a new contract had been awarded to Ilima after the infighting threatened to hamper the project.
Buthelezi's department had "instructed attorneys to institute legal action against the companies".
The joint venture to construct the 3000-bed multi-story Jabulani hospital included Ilima Projects, the Motheo Construction Group, Yikusasa Building Contractors and TTR General Building Construction.
Shareholders include Akona Ngcuka, niece of former Scorpions boss Bulelani Ngcuka, and Deputy President Phumzile MlamboNgcuka.
Ilima is a partner of the Mvelaphanda Group, owned by Tokyo Sexwale.
It is also involved in the R1,8 billion King Senzangakhona Stadium in Durban.
It is also part of the Strategic Partnership Group, a group of companies that are the BEE component on the Gautrain project.