Juventus, unbeaten in Serie A this season and nine points clear at the top as they chase an eighth successive title, confirmed on their website that 31-year-old Caceres, currently with Lazio, had undergone a medical.
“(Caceres) is not a stopgap -- we really wanted to bring him here," Allegri told reporters on Saturday.
"We assessed who we could bring in and we were lucky that Martin accepted. He’s a very good defender and gives us a boost in an area where we’re already very strong. The fact I already know him was a contributing factor."
Caceres previously played for Juventus in the 2009-10 season and then again from the start of 2012 until June 2016.
He spent the second half of the 2016-17 season at Southampton, making one appearance, and last season at Verona, who were relegated. He has played eight times for Lazio since joining them in the close-season.
Morocco defender Benatia is in his third season at Juventus since joining them from Bayern Munich and has already complained about a lack of playing time. Italian media said he was set to join a club in Qatar.
"Benatia asked to leave, which was not what the club had hoped for, but his wish was granted," said Allegri. "It wouldn’t have made sense to keep him against his will."
Juventus visit Lazio on Sunday.
"This is an important game for us because we need to maintain consistency in our results," said Allegri. "We’ll need a good performance in every aspect."
(Writing by Brian Homewood; Editing by Toby Davis)
