The following is a news article from WrestlingObserver.com:
Reports from Japan, as well as a web site post by Mirko Cro Cop both state Cro Cop will be in Japan tomorrow for a press conference put on by Fighting Entertainment Group (K-1), which will announce the debut of a new MMA promotion to take the place of its Hero's division.
Cro Cop was the most popular foreign MMA fighter in Japan when he signed a six-fight deal at the end of 2006 with UFC. After going 1-2 in UFC, it was known UFC was considering cutting him from the deal due to the high cost of his contract.
His heading to the opening of the new group would make it likely that is how things turned out but we haven't had that confirmed from the UFC side.