A Letter to the Board of Emerson

Dear Members of the Board:

We are writing to you on behalf of certain investment funds advised by D. E. Shaw & Co., L.P., (collectively the “D. E. Shaw group”). The D. E. Shaw group is a global investment and technology development firm with over $50 billion in assets under management and a track record of working with companies to create long-term, fundamental value. We have been shareholders of Emerson Electric Co. (the “Company”, “Emerson Electric” or “Emerson”) (NYSE: EMR) for over four years and today hold a more than 1.0% interest in the common stock and equivalents of the Company.

Emerson is an iconic company with world-class assets. However, persistent undermanagement of those assets and a long track record of poor capital allocation, excessive costs, suboptimal business configuration, deficient corporate governance, and misalignment of interests have led to significant underperformance of Emerson stock relative to its peers and to the broader market over every relevant measurement period. Simply put, we believe that Emerson has the assets and businesses to be a great company with a premium valuation, but the management team and Board have let shareholders down.

To create maximum and enduring value for its shareholders, Emerson needs to change. We believe the right set of actions could result in over 50% upside to Emerson’s share price, or over $20 billion of equity value creation for Emerson shareholders, while at the same time preserving Emerson’s market leading position in its various businesses. We have outlined our perspectives in this letter and in the attached slide deck, which we are making available to our fellow shareholders, today.

Important Disclosure

This website reflects the opinions of D. E. Shaw & Co., L.P. (“DESCO LP”) on behalf of certain investment funds managed or advised by it that currently beneficially own, or otherwise have an economic interest in, shares of Emerson Electric Co.  (the “Company”). This website is for informational purposes only and does not constitute investment advice or convey an offer or solicitation of any type with respect to any securities or other financial products. The views expressed in this website are expressed as of the date hereof and are based on publicly available information and DESCO LP’s analyses. No representation is made with respect to the accuracy or completeness of such information, and any analyses provided to assist the recipient of this website in evaluating the matters described herein may be based on subjective assessments and assumptions and may use one among alternative methodologies that produce different results. Accordingly, any analyses should not be viewed as factual and also should not be relied upon as an accurate prediction of future results.  This website also contains statements reflecting DESCO LP’s opinions and beliefs with respect to the Company and its business based on DESCO LP’s research, analysis, and experience; all such statements are based on DESCO LP’s opinion and belief, whether or not those statements are expressly so qualified. All statements contained in this website that are not clearly historical in nature or that necessarily depend on future events are “forward-looking statements,” which are not guarantees of future performance or results, and the words “anticipate,” “believe,” “expect,” “potential,” “could,” “opportunity,” “estimate,” and similar expressions are generally intended to identify forward-looking statements.  DESCO LP acknowledges that the Company may possess information that could lead the Company to disagree with DESCO LP’s views and/or analyses. Nothing contained in this website may be relied upon as a guarantee, promise, assurance, or representation as to future events. The projected results and statements contained in this website that are not historical facts are based on current expectations, and, unless otherwise indicated, speak only as of the date of this website and involve risks that may cause the actual results to be materially different.  Certain information included in this website is based on data obtained from sources considered to be reliable.  The investment funds managed or advised by DESCO LP are in the business of trading (i.e., buying and selling) securities, and it is expected that they will from time to time engage in transactions that result in changes to their beneficial and/or economic interest in the Company.