Jordan Breen explains:

A strong source in the Japanese MMA industry has confirmed to Sherdog.com that Don Quijote, the primary sponsor of World Victory Road's Sengoku, is now a controlling partner of Pancrase.

The Japanese powerhouse chain retailer is best known for their penguin mascot and sponsorship of Hidehiko Yoshida (Pictures) and Kazuhiro Nakamura (Pictures). Don Quijote’s chairman Takao Yasuda is also a powerful figure within the World Victory Road promotion.

After years of operating in the red, Don Quijote has bought out Pancrase's debt and now has a controlling stake in the promotion. With the change, former Pancrase leader Masami Ozaki has been replaced by former Pancrase director and matchmaker Yasushi Sakamoto.

Pancrase will still operate as a separate and autonomous promotion despite drawing a considerable chunk of their resources from the same pool of capital. However, the influence of new leadership was on display at the Aug. 27 Pancrase card. Not only was Yuki Kondo (Pictures)'s main event bout hyped around his participation in the Sengoku middleweight grand prix, but Venezuelan freestyle wrestler Maximo Blanco made his MMA debut on the event's undercard after being signed by Sengoku as a developmental prospect. Also, sitting quietly in the corner on turnbuckle pads was Donpen, the penguin mascot of Don Quijote.

This is beyond encouraging news, although aside from keeping the national scene in Japan healthier I confess to not understanding Quijote's motivation to support these organizations (aside from being supporters of the sport) that clearly are not profit generating operations. What will be interesting to see is if Pancrase becomes some sort of a feeder organization and farm league for Sengoku, a la DEEP to PRIDE. Whatever the case, Quijote has deep pockets and clearly a corporate pledge to mixed martial arts. Sengoku is partly ironing out their problems, partly allowing unresolved issues to persist. But with such firm financial backing, one gets the sense that even though there appears to be a contraction in the MMA market in Japan, there are coffers from strong corporate backers to keep the waters flowing...for now.

More on Don Quijote here.