Daly has lined out for clubs in Greece and Spain since leaving Manchester City in 2009 but has played very little first team football in the last year, yet Mahon is delighted to have landed the 20-year-old on a one-year contract.
"Ian has been training with us for a few days now but we got him signed up today and I think he will be a real player for us this season," Mahon told the Herald.
"Everyone knew we were in the market for another striker as we only have three senior forwards at the club and we have a very busy schedule ahead of us with so many games in all the competitions this season and we needed more cover.
"Ian was available and after having a look at him I was delighted to sign him. It's a good move for us and I think it will be a good move for Ian and his career.
"Being honest, he hasn't done a lot in the last year or so but I know he has ambitions to play at the highest levels and this move to Pats is a chance for Ian to show what he can really do," added Mahon.
"Ian had a great record at underage international level with Ireland and he was highly rated at Manchester City, so hopefully he can kick on at St Pats and really get his career going again."
A product of Home Farm, Daly spent three years at the City academy but was unable to make the first team and when he was allowed to leave in 2009, he was offered a new start by Greek top-flight side Aris Salonica with a two-year deal.
Daly made it into the first team under coach Hector Cuper and racked up a number of appearances, and he also worked his way into the Irish U21 side, scoring on his debut against Armenia last March.
But half-way into that two-year contract Daly moved on, joining Spanish second division side Real Betis last summer.
He was then loaned out to third-tier club Cadiz but left them in January and moved back to Dublin, where he hooked up with St Pats.
Pats are still awaiting international clearance from Spain for the player so he's unlikely to be eligible for tomorrow's Setanta Sports Cup tie at home to Cliftonville, and Pats need all the firepower they can get for that match as the Saints need to overcome a 3-0 deficit from the first leg.
"It's a big ask for us to come back from 3-0 down but hopefully we'll have a big crowd behind us and if we can get an early goal, we'll make a game of it," added Mahon, who hopes to have Dave Mulcahy in the side following injury.