Cadbury's Bournville plant, which employs around 2,500 people, is to benefit from a £40 million investment.
The plan, first announced last year, will see new chocolate-making facilities installed by the end of the year, with a new moulded chocolate bar production line set for the year after.
The expansion is likely to lead to new jobs being created, which will partially offset the 200 expected to be lost with the closure of the Keynsham plant, near Bristol.
Production there is being shipped to Poland, although some of the operation will relocate to Bournville, where millions are also being ploughed into converting a former dining block into new offices.
Head of manufacturing Mark Jones said: "Cadbury's has chosen us as a centre of excellence - we are one of the few manufacturing plants that is investing."
Cadbury will issue its pre-close trading update on June 19 and announce its half-year results on July 30.
The confectioner has now completed the demerger of its Americas Beverages business to the Dr Pepper Snapple Group.
The Bournville company said the reduction of capital would create dist ributable reserves of around £6.6 billion.
The move was confirmed at the High Court yesterday and Cadbury has filed the demerger order at Companies House.
The reserves will be available at the discretion of directors for future distribution to shareholders.
Shareholders in Cadbury Schweppes get 12 DPSG shares for every 36 of the Cadbury beverage shares that they were allotted.
Under the demerger, which became effective on May 2, 253,685,733 DPSG shares have been issued and listed on the New York Stock Exchange.
DPSG shares will be sent out to shareholders next week, along with their new Cadbury ordinary share certificates. The demerger will allow Cadbury to focus on its core confectionary business.