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. Last Updated: 07/27/2016

Baguette Sweetens Fendi's Sale

MILAN, Italy -- Before the launch of its baguette bag in 1997 sent Fendi's name into the fashion stratosphere, the company was simply another well-respected Italian family-owned fashion house that turned out well-crafted luxury products.

But the durable appeal of the baguette - a slim little bag that fits snugly into a woman's underarm - underlines how a bag that achieves cult status can change the fortunes of a fashion house in a business increasingly driven by accessories.

Would LVMH and Prada have offered to pay an estimated $850 million, a steep price even by luxury goods industry standards, for Fendi if it weren't the maker of one of fashion's hottest accessories? Maybe not, analysts said.

"The baguette has in some ways brought the brand back under the fashion spotlight," said Michelle Tsang, a luxury goods analyst at CS First Boston in London.

The sale of Fendi to LVMH-Prada after a long bidding war illustrates both the ruthless consolidation sweeping the industry as well as the increasing importance of accessories to a fashion house's bottom lines.

Fendi's list of celebrities who own one of the most sought-after bags includes Madonna, Cher, Sharon Stone, Mary J. Blidge, Meryl Streep, Elizabeth Hurley, Catherine Z. Jones, Kate Moss, Princess Caroline of Monaco and Jenny McCarthy.

Silvia Venturini Fendi, director of the house's design studio, introduced the bag in a 1997 collection in an attempt to create a "bag coveted by everyone."

"The idea was to make a fascinating object, from an aesthetic point of view, a handbag which could represent a unique, precious, desirable object," Fendi, daughter of Anna Fendi, said in an interview. "We wanted to create a jewel-accessory made in so many versions that each one would give the feeling of possessing a one-of-a-kind piece."

The bag's appeal lies in its variety. There are 500 versions and 300,000 bags so far, including pony-hair prints, sheared or fluffy fur, knitwear coverings, embroidery, sequins, beads and seed pearls and a host of colors, so that each bag seems unique. The fact that the bags are expensive does not mean they are easy to find. Only more intensely desired.

"We have a waiting list of more than 100 people for our next shipment, but I've already had to close the list because I don't want to disappoint people," the manager of Fendi's Milan boutique said in a recent interview.

"The demand was more than we thought, and we have no more baguettes in stock. They've all sold out."

The most popular version this season at the store is an embroidered model that sells for 2.7 million lire ($1,433).

The least expensive version is made from a black synthetic cloth and costs a mere 500,000 lire.

"The fact that it's so difficult to choose one makes you crave to buy more," Fendi said. "One ends up collecting them. That's why it has become a vintage object."

A fashion item has ascended to the realm of cult status when it is copied by cheaper imitators. Sure enough, shops this fall were crammed with imitations - complete with the look-alike trademark "double F" buckle - selling for as little as 50,000 lire.