The 25-year-old midfielder, currently with Serie A side Reggina in Italy, has agreed to a season-long loan with a view to making the move permanent.
Davey said: "Hopefully we will have one new face in the building in Emil Hallfredsson. Emil played for Iceland (on Wednesday night) and will now fly to England.
"We will sit down on Friday morning and hopefully we can get everything signed and sealed then.
"We will still have to apply for international clearance from the Icelandic FA so I'm not expecting him being available for Coventry."
Former Tottenham manager Martin Jol took Hallfredsson to White Hart Lane in 2005 but the winger failed to appear for the first-team and was sent out on loan to Malmo and then Lyn Oslo before securing a permanent deal with Reggina.