We present detailed spectroscopic analysis of the extraordinarily fast-evolving transient AT2018kzr. The transients observed lightcurve showed a rapid decline rate, comparable to the kilonova AT2017gfo. We calculate a self-consistent sequence of radiative transfer models (using TARDIS) and determine that the ejecta material is dominated by intermediate-mass elements (O, Mg and Si), with a photospheric velocity of $sim$12000-14500km/s. The early spectra have the unusual combination of being blue but dominated by strong FeII and FeIII absorption features. We show that this combination is only possible with a high Fe content (3.5%). This implies a high Fe/(Ni+Co) ratio. Given the short time from the transients proposed explosion epoch, the Fe cannot be $^{56}$Fe resulting from the decay of radioactive $^{56}$Ni synthesised in the explosion. Instead, we propose that this is stable $^{54}$Fe, and that the transient is unusually rich in this isotope. We further identify an additional, high-velocity component of ejecta material at $sim$20000-26000km/s, which is mildly asymmetric and detectable through the CaII NIR triplet. We discuss our findings with reference to a range of plausible progenitor systems and compare with published theoretical work. We conclude that AT2018kzr is most likely the result of a merger between an ONe white dwarf and a neutron star or black hole. As such, it would be the second plausible candidate with a good spectral sequence for the electromagnetic counterpart of a compact binary merger, after AT2017gfo.