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Deleting users from production environment
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The only reason the O365 adapter creates new accounts is because the on prem accounts have not been enriched with their email addresses. So if you correct that - which is what I think you mean by merge - then the O365 adapter will not need to create new accounts.
The risk with deleting any user account is to how the user account has been allocated responsibilities in contracts, assets or inventory ownership, or Named user licenses. It is likely that the O365 users have only been allocated to the O365 licenses and nothing else, as they do not occur on your network. You will need to review this to validate the risk of removal