HARRISBURG - The Hershey Co., the nation's leading candy maker, said yesterday that it will shut down a plant in Reading and cut 260 jobs as part of a wider move to cut costs.

It's the second plant-closing announcement in a little over two months after Hershey said it would take dramatic steps to reduce its North American manufacturing and expand in faster-growing markets in the developing world.

Hershey spokesman Kirk Saville said the company would work out severance agreements with Chocolate Workers Local 464 and close the plant in 2008.

Hershey originally purchased the Reading plant from the Dietrich Corp. in 1987 and brought aboard the Luden's cough-drop brand and the 5th Avenue chocolate bar.

The plant also makes York Peppermint Patties, Reese's crispy crunch bars and Jolly Rancher products.

Hershey plans to build a new plant in Monterrey, Mexico, and shift more manufacturing to contractors in the U.S., and has struck agreements with Indian and South Korean companies to make and distribute its products in Asia.

The proportion of Hershey's manufacturing in the U.S. and Canada will shrink, from 94 percent now to 80 percent by 2010, the company has said. *