New York Chocolate and Confections filed for bankruptcy protection Thursday, ending its long attempt to bring chocolate manufacturing back to its North American birthplace.
In its Chapter 11 filing, filed in federal Bankruptcy Court in Syracuse, the company wrote:
“After careful consideration and study of the realistic market opportunities for an independent manufacturer of chocolate products, projected capital requirements to restart New York Chocolateâ€™s operations, and faced with the accumulation of certain debts and other obligations, and the financial drain related to the numerous litigations, New York Chocolate determined that the most efficient way to preserve value for the creditors and other stakeholders was to commence an orderly wind down of its business under the protection of Chapter 11.”
Operation Oswego County, the county’s Industrial Development Agency, was notified of the bankruptcy filing yesterday and held a meeting of its board, said Mike Treadwell, who heads the agency.
Treadwell said New York Chocolate is current on paying its loan back to Operation Oswego County.Â The bankruptcy filing puts the monthly payment at about $8,000 per month.
Treadwell said that the phrase “wind down…its business” does not mean that the plant will close.Â He cites the bankruptcy of Northeast Biofuels’ ethanol plant in Volney.Â The plant was sold to Sonoco, which is operating the facility now.
“Optimistically speaking, it it is our objective to find some way to transition this proceeding into some situation where there would be some ….company or investor group that would utilize the assets in that factory to manufacture product,” Treadwell said.
The bankruptcy filing lays out the sad story of New York Chocolate and Confections, mired for much of its 5 year history in internal bickering, allegations of official corruption and lawsuits.
The last lawsuit was settled earlier this year, but the fight took a toll on the willingness of officials of the Ivory Coast to continue with the project.
The plant in Fulton was bought by a consortium backed by the government of the Ivory Coast as a way to control the means of production of that country’s major crop, cocoa.
Officials from the small African country visited Fulton to see the plant and reassure local officials of their intentions.Â They used loans to buy equipment to replace the chocolate-making equipment Nestle sold at auction when it left.Â They hired former Nestle employees to get the new company up and running.Â The company even showed off chocolate made in Fulton at a press event with Sen. Chuck Schumer.
Hopes were high.
But the coalition of investors who pulled the project together began to fight and sue.Â That stalled the plant, and so did a corruption investigation in the Ivory Coast that resulted in a visit by a whole new group of officials.Â Fulton area officials present for the meeting said it was their impression that the Ivory Coast officials thought that the plant may not have existed, that it was a scam perpetuated by the investors in America.Â That visit did not get things moving again.
“We didn’t see any evidence that was made available to us that there was a plan to refocus and regroup to start the facility up other than they were maintaining it,” Treadwell said.
Treadwell said his agency will look for companies that may want to produce some kind of food product in the plant, essentially returning the effort to where it was when Nestle left.Â The only exception — and it’s a significant one — is that a new company may not inherit a building stripped to the bare walls as New York Chocolate did. There is chocolate-making equipment in this plant that could be sold to a new buyer, provided it is not forced to be auctioned off during the Chapter 11 process.
“We are not accepting the Chapter 11 activity as there’s no absolutely no hope, that the plant’s going to be liquidated, sold, and the plant’s going to be scrapped,” Treadwell said.
Fulton Mayor Ron Woodward got the news Thursday morning at the same time as the general public did.Â Woodward, a Nestle retiree, hopes for the best. “I just want to see those buildings and that property be utilized in some wayÂ puts tax dollars back into the community and puts people back to work,” he said.
Fulton is the home of chocolate in North America.Â The first chocolate made on the continent was made in the city in the late 1800’s.
11:00 am: New York Chocolate and Confections Company, the Ivory Coast government-owned firm that was attempting to restart the closed Nestle chocolate plant, yesterday filed for bankruptcy protection under Chapter 11, which allows reorganization of debts.
Quick update: We’re reading the documents and the company uses the phrase “orderly wind-down of its business”, meaning it appears to plan to shut down.Â More when we get it.
We’ll post the filings here shortly and we’re getting information for a story.Â Keep checking back.
11:45 am: Below are the actual documents filed with Bankruptcy Court in Syracuse today. Read the Insurance Motion or the Utilities Motion to find details about the plans to wind down its business and the reasons behind those plans: