Chobani will acquire the Keurig Dr Pepper (KDP) plant in Allentown, Pa., and then invest $1.2 billion to expand and convert it into a dairy processing plant, according to a release shared with Food Processing by state officials.

A release distributed by Chobani called the move “part of an expanded partnership with Keurig Dr Pepper (KDP),” and a “great starting point” for operations for Chobani. The plant was opened in 2021 by KDP, and Chobani will pay the beverage company about $125 million for the facility and warehouse.

Chobani’s Allentown facility is expected to create 900 jobs in the next five years, and the company plans to operate up to 10 production lines, manufacturing a variety of food products beyond just yogurt.

As part of the bigger deal, KDP will sell its full equity stake in Chobani back to the company for $800 million, and the two will expand their distribution partnership, giving Chobani access to KDP’s company-owned DSD network, which reaches about 80% of the U.S. population. In addition, some of the current Allentown employees will remain with KDP, while the rest will receive offers to join Chobani.

The facility, when fully operational, is expected to offer more than 4,000 regional dairy farmers a new outlet for their products — more than three billion pounds of milk annually is anticipated to pass through the facility. The state said Chobani will assume the 1.5-million-sq.-ft. former KDP facility, equipment and related infrastructure.

The plant will be Chobani’s first in the state — it represents the second billion-dollar-plus investment by in the Northeast U.S. over the last few years, as well as the fifth significant capital project announced over the last several years. The company notes it is investing more than $4 billion in capital projects to build capacity and capabilities to support the next round of growth — it also said it has grown approximately 20 percent annually over the past three years.

Chobani is building a new facility in Rome, N.Y., (also a $1.2 billion investment), expanding its Twin Falls, Idaho, plant ($500 million), renovating its New Berlin, N.Y. site, and expanding its Norton Shores, Mich., facility ($567 million), which produces La Colombe beverages.

Production at the plant is expected to begin in 2027.