As an effort to give an SSO experience, I am building a asp .net shim that takes credential (username/domain/password) via an HTTP POST call, impersonates with that credential and then launch FIM portal from the impersonate mode. however, a prompt for username/password is still being raised before landing to the FIM portal. Any insight what can be done to directly land on the FIM portal w/o entering the username/password?

Make sure your authentication mechanism is ok (if you use Kerberos, check SPNs and delegation).

Moreover, in most deployments, we use GPO to add FIM Portal to trusted sites so user is automatically logged in without being prompted for credentials.