Efficient power management functions are essential in microgrids with a substantial integration of distributed generation (DG) units to maintain good power quality and reliability for the customers. The microgrid interconnections significantly improve the power management capabilities, and the medium voltage (MV) dc systems are considered to be a promising option for this purpose. The ac-dc interconnections are realized using power electronic solutions. This paper proposes a smart transformer (ST) enabled MVDC interconnected meshed hybrid microgrid. The STs’ capability to form the MVDC bus is explored in this paper to establish an MVDC distribution line with a battery energy storage system (BESS) integration. This restructuring introduces multiple paths for the controlled active power flow in the overall microgrid. Moreover, the performance of the system is analyzed during voltage sag, and the operational flexibility of the proposed system is presented through simulation results.