There was an explosion of covered call warrants issued on Cosco Pacific yesterday after the stock closed at $6.90, pushing up the total value of its free-floatshares to $4 billion. Under recently established stock exchange rules, a company's free-float must total $4 billion to be eligible for warrant issues. Three brokerages successfully issued 554 million American style warrants each, while at least two others attempted to issue but were crowded out of the market, traders said. Merrill Lynch issued at a price of 19.8 cents, with gearing of 3.48 times and expiring on September 19, 1997, with a strike price of $5.52. Deutche Morgan Grenfell issued at 21.23 cents, with a gearing of 3.25 times and expiring on March 20, 1998, at a strike price of $5.865. Credit Lyonnais issued at 19.527 cents, with a gearing of 3.69 times and maturing on September 22, 1997, at $5.52. In each case, 10 shares are exercisable into one Cosco share. Brokers were not surprised at yesterday's warrant rush. A spokesman at Merrill Lynch said: 'Everybody, including Merrill Lynch, has been waiting for this moment so we can launch a warrant, because this is a stock that the market loves.' Since September 1, Cosco's share price has surged more than 15 per cent. Market players said the parent company, Cosco Group of China, has regularly injected assets into the firm. Following the release of interim results next week, market sources expect there will be further asset injections, and possibly a share placement.