Cancellation letter asks for homespot return

I got an O2 4G Homespot just over two years ago.  My contract recently came to an end and I went into my local O2 store to order an upgrade to wired broadband with a FritzBox.

I recently got a letter from O2 (helpfully in German despite O2 knowing I’m an English speaker) When I translated the letter using Google translate it said that O2 were sorry I was leaving and asking me to return the Homespot or face a financial penalty.

The thing is, when I took out the O2 contract I had to buy the Homespot - it wasn’t given to me for free.  My contract from the day even shows a €49.99 charge for the device.

So, if I bought it, and the contract shows I bought it, why are O2 DE asking for it back and threatening me with a charge if I don’t return it?