The free transfer move is subject to a medical and the agreement of personal terms but head coach Martin Jol is delighted with the move for the 32-year-old.
Jol told the club's website: 'He is one of the most versatile midfielders a playmaker a ball-winner with great stamina and huge charisma and one of the best midfielders to come out of Holland in the last 10 years.'
Jol added: 'This is a player who went to Barcelona when they were middle of the league and took them close to winning the title.
'It's terrific that he is joining us. This is the player we have spoken about who will lift the team's performance. We have a young squad with an average age of 23 and I believe Edgar will come in and lead by example.'
Davids has won 73 caps for Holland representing the Dutch in four major finals and has played in four Champions League finals tasting victory with Ajax in 1995.
He was a product of Ajax's famous youth system making his debut for the Amsterdam giants aged just 18 and winning successive league titles in 1994 1995 and 1996 and the UEFA Cup in 1992.
A move to Serie A and AC Milan followed in 1996 before a switch to Juventus in December 1997.
He spent seven years at the Turin club during which he helped them to the final of the Champions League on three occasions - 1997 1998 and 2003. He also bagged three domestic titles with Juventus in 1998 2002 and 2003.
He moved on loan to Barcelona in the 2003-04 season and was credited with helping turn around the fortunes of the Nou Camp outfit as they finished second that season behind Valencia.
He then returned to Italy joining Inter for the 2004-05 campaign.