I presume VR is for Victoria Regina (I tried 5th regiment, it didn't work), keep in mind that the VR flanked crown was used on much more than post boxes. It was something like a stamp of government ownership. I believe it can still be found on some lamp posts in central London. Also note the crown's top jewel with the big X.
I think the damage on four sides of the edge was done by four big, tight, clumsy clamps, fixing the coin onto something flat. The "cloud" in front of Britannia's face looks like a bungled attempt to make a hole with a small drill bit. They should have prepared the coin by make a pit with a nail and a hammer, so that the drill bit would not have skidded on the smooth surface of the coin.
No idea what the M stands for and (Murphy's law) that's the key to full id. The klutziness, combined with the official-looking punch leads me towards people used to working with big metal objects, such as ship yard workers.
Peter