(FORTUNE Magazine) – COULD THE JAPANESE stock market, second largest in the world, become the next hunting ground for corporate raiders? A brash young Briton vows to make it so. ''Japanese corporate managements believe their little club cannot be broken into,'' says Terence P. Ramsden, 33-year-old proprietor of Glen International Financial Service Co. in London. ''They're wrong, and that's what I'm about to prove.'' If he succeeds, he'll surprise a lot of people. Hostile takeovers are seldom attempted in Japan even by Japanese, and none has ever succeeded. But in mid-November Ramsden was preparing a raid on a Japanese corporation, the first ever mounted in Japan by Westerners. The target of his $1.4-billion offer -- promptly rejected -- is Minebea Co., a manufacturing conglomerate that derives its name from miniature bearings, its main product line. Minebea earned $28 million on sales of $717 million in the fiscal year that ended in September. Ramsden won't name Glen International's backers, but he numbers among them some ''very influential'' Japanese, as well as big institutions and high- rolling individuals -- American, Swiss, Arab, and German. His partner in the Minebea bid is Trafalgar Holdings, a private Los Angeles company controlled by Charles W. Knapp, 51, former chairman of Financial Corp. of America. In nine torrid years at Financial Corp., Knapp built up the largest U.S. savings and loan, then resigned last year under pressure from banking regulators after bad loans and a run by depositors led to a liquidity crunch. At Minebea, Ramsden and Knapp will be going toe to toe with another nonestablishment figure, Takami Takahashi, 56, who is best known in the West for his tough, unJapanese management style (FORTUNE, January 7, 1985). Ramsden says Takahashi attracted a raid in August by launching a hostile takeover bid for Sankyo Seiki Manufacturing, a machinery maker. That move violated the Japanese taboo against hostile bids and may deprive Takahashi of the local support he might otherwise expect in resisting a foreign attack. ''There are forces in Japan that want the system opened up, and I'm quite close to them,'' Ramsden asserts. ''They can't be seen to be opening the system for themselves, so they advise me. I'm a catalyst.'' Ramsden and Knapp say they already control 37% of Minebea. Minebea is not the only Japanese company Ramsden has in his sights. He is treating Japan to another first-ever assault from the mysterious West by filing a shareholder suit. His target is Tokyo Sanyo Electric, a consumer electronics and appliances manufacturer in which he has invested. Tokyo Sanyo, Ramsden alleges, has run up unnecessarily expensive debt and hurt the price of its shares. ''I fully intend to oust the management of this company,'' he says. Ramsden has had to do some fancy footwork simply to get into the ring for round one of a hostile takeover battle in Japan. A working-class lad from North London, Terry Ramsden left school at 16 for a succession of jobs at a half-dozen brokerage firms. After years in back offices, he became a trader in 1975, specializing in Japanese issues. Over the phone and on trips to Japan, he says, he mastered the details of the country's financial markets and learned to put together complicated transactions in Japanese securities issued in Europe. MUTUAL FRIENDS brought Ramsden and Knapp together about a year ago. ''It's a good partnership,'' Ramsden says. ''What I create, Charlie can bank.'' Knapp never lacked for innovative ideas while at Financial Corp. and claims to be working on takeover deals around the world at Trafalgar. He says he defers to Ramsden on Japan. ''Terry is a true whiz kid,'' Knapp says. ''He may be the ultimate whiz kid. Of non-Japanese investors, he's an expert, if not the expert, on Japanese securities.'' Ramsden thinks along the same lines: ''It's pretty well accepted that I'm one of the foremost experts in the market, if not the foremost.'' For all that supposed savvy, Ramsden could have passed as the foremost nonentity in the Japanese business world before the Minebea bid began to make headlines. The key to Ramsden's assault on the Japanese market is a reasonably obscure security, the detached foreign-currency-denominated equity warrant, which more than 100 Japanese companies have adopted in the past few years to sweeten offerings of fixed interest rate bonds in the Euromarket. To the bonds they attach warrants that give a purchaser the option to buy a fixed number of new shares at a fixed price for long periods, typically five years. Once the bonds are issued, investors can detach the warrants and trade them separately. The Japanese issue warrants in quantities that can add up to a larger proportion of an issuing company's capital than is common in the West. For a typical investor -- say, a West German insurance company or a British pension fund -- these warrants provide a leveraged way to play the Japanese stock market. The warrant attached to a $5,000 bond entitles the holder to buy a prescribed number of shares for $5,000 at any time during the warrant's five-year life. When newly detached from its bond, such a warrant typically has started trading at $1,000, representing a bet that those shares would rise in value by more than 20%, to more than $6,000, over the warrant's life -- not an unlikely outcome, given the buoyant Japanese equity market of the past decade. For that $1,000 warrant price, the investor gets to enjoy the same profit as someone who shelled out $5,000 for the shares themselves. A $1,000, or 20%, capital gain for the shareholder would mean a $1,000, or 100%, gain for the warrant holder. For Ramsden, warrants aren't passive investments, but vehicles for controlling big blocks of stock on the cheap. And on the quiet: warrants, like all securities in the Euromarket, trade anonymously in bearer form. Over the past two years, Ramsden says, he has piled up large warrant holdings at prices that were unrealistically low before investors began to feel comfortable with them. On occasion Ramsden's purchases have driven prices way up. ''You get the core of your holding as cheaply as possible,'' he explains. ''What you pay for the last few warrants doesn't materially affect your overall price, does it?'' By topping up his warrant holdings with convertible bonds, Ramsden says he has snared strategic stakes not just in Minebea and Tokyo Sanyo, but in several other companies. ''If everything goes my way,'' he brags, ''I could end up the first self-made English billionaire.'' To that amazing prediction, Ramsden adds the stunning claim that he already enjoys a net worth of more than (pounds)100 million (about $140 million). This bewilders many of Ramsden's acquaintances in the City, London's financial district, who remember him as a lowly clerk. Still, Ramsden puts on a convincing display of sudden wealth, from gold chains and a diamond pinky ring to houses in England and Bermuda, a stable of racehorses, a private jet, a private helicopter, and a stretched Mercedes limo bristling with telephones, a telex machine, and what Ramsden says is Britain's only mobile facsimile machine. When the weather's not good in Bermuda he may fly to Paradise Island in the Bahamas. ''I've done well,'' he says. Minebea shows no signs of being willing for him to do well at its expense. The company vows to defend itself by diluting Trafalgar and Glen's holdings with a private placement of convertible debentures and a merger with an apparel company. Minebea says that these moves will place just over half its shares in friendly hands. Ramsden says he will sue to block the transactions and hints that some of Minebea's supposed friends are as unhappy as he is with all that dilution. The tender offer he plans will win the support of those disaffected shareholders, Ramsden says. If it doesn't, he vows to mop up enough shares in the market to win control. The one other outcome he sees is the emergence of a competing bidder, to whom he would sell if the price were right. ''We win, or we win, or we win,'' Ramsden says. He seems untroubled by the possibility that Japan's Ministry of Finance could intervene to head him off. ''We've done everything by the book,'' Ramsden says. In the mind of one tenacious Briton, the age of the raider has dawned in Japan.