Renewable energy sources (RES) induce problems such as voltage and current limit violations, absence of inertia and consequent stability problems, and poor power quality. Smart transformer (ST) is a promising solution for avoiding such a changing grid scenario leading to strong grid reinforcements. This article proposes an ST-enabled meshed hybrid distribution grid to achieve voltage and power flow control simultaneously with a centralized controller. In this configuration, a low-voltage dc (LVdc) line is proposed which connects the ST LVdc link with the dc bus of distributed generation (DG) converters. This introduces various active power flow paths to support the loads. The DG converters supply active power near the load points which ensures that line losses are reduced significantly while achieving improved voltage regulation as compared to conventional microgrid. Moreover, the DG converters can draw active power from ST LVdc link during absence of RES to support the load, resulting in improved utilization of these converters. The control complexity of the DG converters is reduced as the ST controls both the LVac and LVdc line voltages. Further, the newly developed power flow path allows reverse power flow from DG plants more efficiently. Performance of the proposed system is verified with simulation and experimental results.