UPDATE 2-Singapore ST Engg sells $500 mln 10-yr bond

(Adds final pricing)

HONG KONG/LONDON, July 9 (Reuters) - Singapore Technologies Engineering (STEG.SI) sold a $500 million 10-year bond on Thursday at 150 basis points over U.S. Treasuries, tighter than initial price guidance.

The deal is a rare AAA-rated corporate offshore bond out of non-Japan Asia. According to Thomson Reuters data the last deal with a top rating was in 2006 from Singapore's PSA Corp, which was rated Aaa by Moody's Investors Service.

The bond is being managed by Deutsche Bank and Morgan Stanley.

The issue, done via the company's wholly-owned subsidiary, ST Engineering Financial 1 Ltd, has a coupon of 4.8 percent and issue price of 99.404.

Initial guidance was for a yield of 160-170 bps over U.S. Treasuries, according to a source in Asia close to the deal.

Singapore Technologies Engineering, in which state investor Temasek Holdings [TEM.UL] has more than a 50 percent stake, has been rated AAA by Standard & Poor's.

"The AAA rating on STE reflects Standard & Poor's opinion that there is an extremely high likelihood that the government of Singapore would provide timely and sufficient extraordinary support to STE in the event of financial distress," the agency said.

On Monday the engineering conglomerate said it aimed to raise $1.2 billion worth of medium-term notes in various currencies to fund future investments, including acquisitions and debt refinancing. (Reporting by Saeed Azhar in Singapore, Umesh Desai in Hong Kong and Carolyn Cohn in London; Editing by Greg Mahlich)