In early August 2015, Cargill announced that it had completed its acquisition of Archer Daniels Midland’s global chocolate business at an enterprise value of $440 million. The deal was covered mostly in trade publications and business pages. In Lititz, it would soon become local news.
Cargill, the Minnesota-based food and agriculture company, had owned Wilbur Chocolate in Lititz since 1992. Less than three months after the ADM deal closed, it announced that the historic Wilbur factory on North Broad Street would stop production in January 2016.
What Cargill bought
ADM’s chocolate business was a major supplier of industrial chocolate, the bulk product that candy makers, bakeries, dairy companies and other food manufacturers buy to make their own products. It was a business-to-business operation rather than a maker of brand-name candy bars.
Cargill said the combined business would give it broader product ranges and more capacity to serve customers. After the deal, its cocoa and chocolate operations ran at 27 sites in 11 countries with more than 3,000 employees, serving confectionery, bakery and dairy customers around the world.
The acquisition required approval from competition regulators, including the European Commission, which cleared it with conditions. Cargill agreed to sell off part of the combined business to satisfy those concerns.
Why consolidation hits small plants
When large companies combine, they usually look for ways to cut overlapping costs. In manufacturing, that often means consolidating production into fewer, larger plants. Older facilities in historic buildings, with multistory layouts and limited room to expand, can be the first to go, because modern lines are designed for single-level plants with truck access and room for automation.
The Wilbur factory in downtown Lititz had been making chocolate on the same site for more than a century. Its location made it beloved by residents and visitors, but also expensive to modernize.
Cargill did not publicly tie the Lititz closing directly to the ADM purchase. The timing, though, led many residents to connect the two.
The local impact
The closing affected more than 100 jobs in Lititz, most in production. The Wilbur Chocolate retail store stayed open, moving in October 2016 to 45 N. Broad St. The factory was emptied in an equipment auction later that year, and the property was sold to Oak Tree Development Group in January 2018 for $2.25 million. It reopened in 2019 as The Wilbur Lititz, a Tapestry Collection by Hilton hotel, alongside apartments and condominiums.
The loss of manufacturing jobs was offset over time by new jobs in hospitality and construction, and by the continued growth of Rock Lititz and the live-event industry on the edge of town. But the jobs were different, and many former Wilbur workers had spent decades in the plant.
Reading corporate deals as a local reader
For a small town, decisions made in distant boardrooms can matter as much as anything decided at borough council. A few things to watch when a company with a local plant announces a merger or acquisition:
- Does the buyer have similar plants nearby? Overlap is a warning sign for consolidation.
- Has the company made recent investments in the local site? New equipment suggests a longer commitment.
- What do regulators require? Conditions can force a company to sell certain facilities.
- What do layoff filings show? Notices required under the federal WARN Act are posted by Pennsylvania’s Department of Labor & Industry and list planned mass layoffs and plant closings, usually 60 days in advance.
- Who owns the real estate? If the company owns a large downtown property, a closing will quickly raise questions about redevelopment, as it did here.
Our restored coverage of the closing is here: The Day Lititz Learned the Wilbur Chocolate Factory Would Close. For more on money and the local economy, see our Finance section.