In a hybrid modular multilevel converter (MMC), capacitor voltage balance between the Full-Bridge Sub-Modules (FBSMs) and Half-Bridge Sub-Modules (HBSMs) is only possible when the arm currents are bipolar. For a grid-connected MMC, operating at unity power factor, this is typically achievable when the modulation index is less than 2. Previous control methodologies, based on open-loop feed-forward compensating currents, have been proposed to operate an MMC with a higher modulation index. However, these solutions do not minimize the compensating currents; they cannot compensate entirely for both the variations in the operating conditions and the parameters typically encountered in a real implementation; and they do not consider the actual capacitor voltage imbalance between the FBSM and HBSMs. In this paper, a new nested closed-loop control algorithm based on an outer voltage control loop with an inner current loop is proposed and experimentally validated. Feed-forward currents are still utilised in the inner loop, but they are calculated using a new optimising algorithm which minimises the required compensating currents. Moreover, to the best of our knowledge, this is the first work where explicit algebraic equations to calculate these compensating currents are provided. Experimental results to validate the approach, obtained with an 18-cell hybrid MMC, are presented and discussed in the paper.