CRM 2013 Client for outlook cannot connect to CRM 2013 instance

Hoping this is the right forum couldnt see any specifically related to CRM
Ok we have recently setup an On-premise installation of Dynamics CRM 2013 and running the client on Outlook 2013 with Exchange 2010.
The CRM installation has had update rollup 1 applied to the server and outlook client
We have and IFD and ADFS deployment setup (*we require ADFS for a sister company as they will be utilising CRM also)
When we try to connect the outlook client we just keep getting prompted for credentials and it never connects.
In the log the following entries appear
12:17:08|  Error| Error connecting to URL: https://internal.crm.timg.com/XRMServices/2011/Discovery.svc Exception: Microsoft.Crm.CrmException: Authentication failed
   at Microsoft.Crm.Outlook.ClientAuth.ClaimsBasedAuthProvider`1.AuthenticateClaims()
   at Microsoft.Crm.Outlook.ClientAuth.ClaimsBasedAuthProvider`1.SignIn()
   at Microsoft.Crm.Outlook.ClientAuth.ClientAuthProvidersFactory`1.SignIn(Uri endPoint, Credential credentials, AuthUIMode uiMode, IClientOrganizationContext context, Form parentWindow, Boolean retryOnError)
   at Microsoft.Crm.Application.Outlook.Config.DeploymentsInfo.DeploymentInfo.LoadOrganizations(AuthUIMode uiMode, Form parentWindow, Credential credentials)
   at Microsoft.Crm.Application.Outlook.Config.DeploymentsInfo.InternalLoadOrganizations(OrganizationDetailCollection orgs, AuthUIMode uiMode, Form parentWindow)
This occurs when setting up the configuration with either outlook opened or closed.
I was assuming somewhere along the lines it is getting hung up with the claims process for ADFS on authentication.
Any information on this would be appreciated. CRM logins work fine for users logging into the main CRM site, just the outlook client wont authenticate.

Did you ever have luck fixing this? I'm having a similar issue with the login box prompting but if the users put in
[email protected] & normal password they can login without issues. But it should just be using their normal Windows credentials without a need to separately authenticate.  We happen to be on Windows 2012 R2, ADFS
3.0 with our CRM 2013 install. 

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