PACIFIC ALLIAN ORD USD0 01 : Further Update to the Proposed Share Exchange

30 June 2015

Pacific Alliance Asia Opportunity Fund Limited

Further Update to the Proposed Share Exchange with Feeder III

Pacific Alliance Asia Opportunity Fund Limited ('PAX' or the 'Company') (AIM: PAX), the closed-end investment company admitted to trading on AIM and listed feeder for Pacific Alliance Asia Opportunity Fund L.P. (the 'Master Fund'), announces the following further update on the proposed Share Exchange with Feeder III that was the last of the initiatives intended to close the discount between the Company's market price and net asset value ('NAV') per share as well as to provide exit opportunities for selling shareholders.

As stated in the Company's 22 September 2014 announcement, the Board and the Manager would assess the impact of these initiatives on a regular basis, and the Board committed to seek shareholder approval to wind up the Company should the NAV fall below USD30 million. These measures were adopted to remove any shareholder concern over the Company becoming too small, or of becoming a trapped minority, if the discount initiatives were widely taken up.

After further consideration, and after further consultation with Grant Thornton, the Company's Nominated Advisor (the 'Nomad'), the Board has concluded the proposed Share Exchange with Feeder III is no longer feasible because it would reduce the size of the Company to the point that it would no longer be viable as an AIM traded company. Accordingly, this initiative would not be in the best interests of shareholders as a whole;

The Board acknowledges, however, that a large majority of the Company's shareholders continue to express an interest in receiving Feeder III Shares, and therefore the possibility of achieving this outcome by way of delisting, liquidating and winding up the Company should be presented to shareholders for consideration;

The Board will be meeting with potential liquidators for this purpose and will encourage the chosen liquidator to allow eligible shareholders who so elect to receive the value of their interest in the Company as Feeder III Shares of equivalent value, with all other shareholders receiving the value of their interests in cash;

It is expected that a circular describing the proposed delisting, liquidation and winding up process, along with an EGM Notice and Form of Proxy, with be distributed to shareholders by mid-July, with the intention of holding a shareholder vote on the proposed actions in mid- August;

In the meantime, a redemption notice will be submitted for all of the Company's Feeder III Shares in anticipation of the proposed liquidation (the 'Redemption'), preliminary details of which are set out below:

Redemption Notice Date: 30 June 2015

Redemption Date: 31 December 2015

Redemption NAV Date: 31 December 2015

Estimated Settlement Date: 15 January 2016

Feeder III Shares to be Redeemed: 87,709,479.062

Given the anticipatory nature of the Redemption, the Company has requested, and Feeder III has determined, to allow the Company to reduce the number of Feeder III Shares so redeemed should that become necessary (i) if the liquidation is not approved by the Company's shareholders, or (ii) to allow the Company's liquidator to distribute a specified number of Feeder III Shares in the liquidation.

For further information, please contact:

About Pacific Alliance Asia Opportunity Fund Limited

Pacific Alliance Asia Opportunity Fund Limited (AIM: PAX) is a closed-end investment company with net assets of US$160.68 million as at 31 May 2015. PAX was admitted to trading on the AIM Market of the London Stock Exchange in September 2006 and is a feeder fund for Pacific Alliance Asia Opportunity Fund L.P. (the 'Master Fund'). The Master Fund's investment objective is to generate superior risk adjusted returns through investing in the most attractive opportunities in the Asian markets. The Master Fund is opportunistic and dynamic with respect to the strategies it employs and invests across the capital structure in search of the best risk adjusted returns. It pursues distressed credit, special situations, arbitrage and origination strategies, concentrating on mispricings rather than directional exposure.

For more information about Pacific Alliance Asia Opportunity Fund Limited, please visit:www.pax-fund.com

Pacific Alliance Asia OpportunityFund Limited is a member of PAG (formerly known as Pacific Alliance Group), the Asian alternative investment fund management group. Founded in 2002, PAG is now one of the region's largest Asia-focused alternative investment managers, with funds under management across Private Equity, Real Estate and Absolute Return strategies.

PAG has a presence across Asia with over 330 staff working in the region.

For more information about PAG, please visit:www.pagasia.com