Combine first 3 ingredients in a large saucepan; cook over medium-high heat until sugar dissolves and mixture is golden (about 5 minutes), stirring frequently. Remove from heat; cool slightly.

Add milk and chocolate, stirring with a whisk. Heat over medium-low heat to 180° or until bubbles form around edge of pan, stirring frequently (do not boil). Strain mixture through a sieve into a bowl; discard solids.