Replacing some characters in a string with another character

echo "$string" | tr xyz _

would replace each occurrence of x, y, or z with _, giving A__BC___DEF__LMN in your example.

echo "$string" | sed -r 's/[xyz]+/_/g'

would replace repeating occurrences of x, y, or z with a single _, giving A_BC_DEF_LMN in your example.

Using Bash Parameter Expansion:

orig="AxxBCyyyDEFzzLMN"
mod=${orig//[xyz]/_}