You are incorrect -- there is NO dilution by them offering some of their shares. There is no change in # of shares outstanding (which would dilute). Rather, in short term, it increases supply of shares for trading. However, as you say, it moves Rio one step closer to not having control, and reduces the overhang of the potential of this happening... because it just did! These things are non-events once shares are successfully sold in the secondary, and the market digests in a day or so.