Tokyo Smoke is closing 29 locations as it undergoes major restructuring and seeks creditor protection, the company announced late Wednesday.

The cannabis retailer says it has secured financing to continue operating roughly 167 locations across Ontario, Manitoba, Saskatchewan and Newfoundland and Labrador. That encompasses the company’s retail programs and medical cannabis business.

Retail locations unaffected by the restructuring will continue operating as normal, with no disruption or changes to the company’s online business or The High Roller Club loyalty program.

Tokyo Smoke said it restructured to align with current market and regulatory conditions, which it says have changed significantly. The company added it will seek an exit from Companies Creditor Arrangement Act (CCAA) protection.

It is unclear how the restructuring will impact the company’s more than 500 employees across Canada.

Tokyo Smoke declined to comment when contacted by strategy for this story.

In 2022, experts predicted that an oversaturation of cannabis retailers, particularly in major urban centers, would result in mass closures.

That same year, the City of Toronto unanimously passed a motion to support a bill that would amend the Cannabis Licence Act, changing the approval process for cannabis retailers. The move was designed to give more power to municipalities to approve or deny cannabis shops in their cities.