Fred's Completes Acquisition of Reeves-Sain Drug Store and EntrustRx Specialty Pharmacy

April 22, 2015

PRESS RELEASE

MEMPHIS, Tenn. (April 20, 2015) — Fred's, Inc. (NASDAQ: FRED) today announced that it has completed the previously reported $66 million acquisition of Reeves-Sain Drug Store, Inc., a private specialty and retail pharmacy company, including its EntrustRx specialty pharmacy operation.

EntrustRx, which is licensed in all 50 states, has a strong regional presence in the Southeast, serviced from facilities in Spring Hill, Tennessee and Columbus, Mississippi. It dispenses specialty pharmaceuticals to treat complex conditions and diseases that typically require ongoing support for extensive periods of time, with main therapy lines that include hepatitis C, oncology, growth hormones, multiple sclerosis, and rheumatology. The single Reeves-Sain retail pharmacy operates in Murfreesboro, Tennessee.

"We continue to be very excited about the prospects for expansion in specialty pharmacy, the largest growth area of the pharmacy industry," said Fred's CEO Jerry Shore, "and we expect that EntrustRx will increase the momentum of these efforts. Specifically, this acquisition strengthens our specialty pharmacy operations, and the Reeves-Sain Drug Store is a model for a scalable retail experience providing clinical services, immunizations, compounding, and hospice medications. We welcome the skilled and valued EntrustRx and Reeves-Sain Drug Store employees to the Fred's team and know that they will make great contributions to the future of our pharmacy operations."

Fred's, Inc. operates 661 discount general merchandise stores, including 19 franchised Fred's stores, in the southeastern United States. For more information about the Company, visit Fred's website at www.fredsinc.com.