ABM - Apple ID Already Exists

We are looking to enforce mobile device management across our estate of approx. 100+ iOS devices and users to date, have been able to setup an Apple ID using their work email address, using domains that we as an organisation have management of. When attempting to create a managed Apple ID it tells me the user already exists.

We have enabled federated sync, directory syncing and validated our domain names between our M365 tenant and ABM and the user provisioning has run successfully.

What I want to explore, is how we take over these Apple IDs and make them managed Apple IDs instead of independent user ones?